For rhythm games, you want to minimize jitter, latency doesn't matter much. Most games usually have some kind of compensation, so really the only thing that high latency does is delay in visual feedback, which usually doesn't matter that much as players are not focusing on the notes they just played. And even without compensation, it is possible to adjust as long as the latency is constant (it is not a good thing though).
It matters more in fighting games, where reaction time is crucial because you don't know in advance what your opponent is doing. Fighting game players are usually picky about their controller electronics for that reason, the net code of online games also gets a lot of attention.
In a rhythm game, you usually have 100s of ms to prepare you moves, even when the execution is much faster. It is a form of pipelining.
It matters more in fighting games, where reaction time is crucial because you don't know in advance what your opponent is doing. Fighting game players are usually picky about their controller electronics for that reason, the net code of online games also gets a lot of attention.
In a rhythm game, you usually have 100s of ms to prepare you moves, even when the execution is much faster. It is a form of pipelining.