OK, sounds like you have most of the potential problems worked out. It would certainly be a cheap way to run a huge game - you'd only really need to pay for one server (World server), and not even an especially super-fast one either. Perhaps one of us bedroom programmers could even run a successful MMORPG without having to pay huge server costs. I like the idea.
About security: I was thinking more along the lines of people being able to use packet sniffers to work out your packet formats, and then make artificial packets which would allow them to cheat. Of course that problem is always present, but I think it would be worse if the person's PC was acting as a server.
Also, wouldn't you get sudden jumps when a server-player left unexpectedly and the server had to be quickly changed to another player? How long do you think it would take to do the switch? I'm thinking at least a second or two, maybe even longer if a lot of game data has to be sent.
About security: I was thinking more along the lines of people being able to use packet sniffers to work out your packet formats, and then make artificial packets which would allow them to cheat. Of course that problem is always present, but I think it would be worse if the person's PC was acting as a server.
Also, wouldn't you get sudden jumps when a server-player left unexpectedly and the server had to be quickly changed to another player? How long do you think it would take to do the switch? I'm thinking at least a second or two, maybe even longer if a lot of game data has to be sent.