So, After playing and thinking thoroughly about this, I find besides running against a mexinection from Canada, even on host, I have huge trouble telling who is.
If anyone knows the answer or can confirm my ideas please tell me.
It seems in gears 2, when you lagged, and fired a bullet of any kind, it would take "x" amount of time to connect to the host that the shot was fired. (Which is why I always try to tell people, host isn't LITERALLY stronger, just more accurate/ faster in a way) So if I fire a sniper shot at someones head while they are roadie running, the time for the shot to register to the host, means the person is no longer in the same area, thus no headshot.
What I've found happens in gears 3 though, is that the game seems to take a snapshot of your screen before connecting to the host, so that even if there IS SEVERE latency issues, the shot still registers as a head shot. Multiple times I've gotten supermans on standing still opponents, only to have them jump half a second after they see me, and the headshot registers after they jump, even though I shot them a second before while they were standing still.
My question is, has there actually been any change in the hit detection/registry to compensate with laggy matches, so that no matter what, so long as the players' game shows a hitbox connection, that no matter what the lag. the bullets still register, they just take longer to take effect?