Love this war story. Partially because to a less dramatic extend, I solved a similar situation also with 'traffic shaping' using Linux a year ago. So that's why it resonates for me. I'm not an OpenBSD user but I do respect it's capabilities. I wrote a blog post on how I did it: http://louwrentius.com/how-traffic-shaping-can-dramatically-...
Can someone how traffic shaping reduces latency rather than simply lowering the amount of load required to cause significant latency? I understand that the aim here is to prevent the router from having to queue packets, but by doing this haven't we just shifted the queue and source at which packets are dropped from the router to the Linux box?
Eventually most of the buffered packets are so late that they're considered missing/dropped, though they took bandwidth to send and caused other packets to wait behind them. Then TCP adjusts to a long series of lost packets by dropping the rate dramatically.
TCP isn't supposed to work that way :)