You're using confusing terminology so you look very wrong. What you mean to say is direct modem-to-modem connections were not laggy because there was no packet switching. This is a true statement.

What the GP comment was talking about was dial-up Internet being most people's exposure to TCP/IP gaming in the 90s. That was most assuredly laggy. Even the best dial-up Internet connections had at least 100ms of latency just from buffering in the modems.

The QuakeWorld network stack was built to handle the high latency and jitter of dial-up Internet connections. The original Quake's network was fine on a LAN or fast Internet connection (e.g. a dorm ResNet) but was sub-par on dial-up.