hi, first of all replication feature has no client prediction yet so it will not be excellent even with zero ping.
secondly the dead reckoning algorithm is sensitive to frequent frame rate changes and in some cases unreal does not give stable frame rates when the window looses focus.
for ex. when i open 2 instances(windows) of the demo and put them on different displays it behaves poorly but if i put them on the same monitor it works just fine. may be your problem is about something similar, so check your frame rates, if they are fluctuating too much try to eliminate that case.