Making the records more frequent does not at all reduce the latency that is the product of: the laws of physics and processing delays.
It doesn't reduce the overall latency, but it certainly does divide it up into smaller amounts.
That is all that matters for getting confirmations. And as I said, the bandwidth factor is significantly reduced so the latency of transmitting the data is all during the original transaction, not during the record transmission.
My (admittedly slow) node
spends about 700ms processing generating new Bitcoin blocks, plus another 1.7 seconds processing new P2Pool blocks (which are every 30 seconds). This is with a SSD, BTW.
I assume most of that is verifying transactions? If the two peers have seen all the transactions in a record, there is no need to verify anything but the record's signature. I'm not going to delve too deeply into how my memory cache works, but the transaction order is canonical and once the peer has received a record packet from another peer and converted it into something the local cache can use, it is looking for mostly contiguous chunks of memory which is extremely fast. And it doesn't need to search - it is getting a direct pointer to the location of the transaction.
Edit: Given the aggressive block record times, how are accidental forks and orphans (children of potential forks) handled?
There is no competition - one voice controls one block of time (unless there are so many that multiple control each block of time, then they use a modulo function to determine which transactions they include). Duplicated transactions in subsequent records that did not acknowledge the earlier other are just ignored, and they do not pose any real penalty on data transmission or verification time. Double spent transactions are resolved by ceding to the record that controlled an earlier block of time - most of the time, this is covered in a little bit of detail in the paper. Unfortunately for the sake of SPV nodes this might require a "reversed transactions" log which still won't require much resources. But maybe not, as if they are worried enough to see their balance update, they will notice that it did not update anyway.