This could work for casual FPS games, but for competitive FPS gaming like Counter-Strike or Valorant, 20ms is a deal breaker for players who want to perform at a high level.

Pro FPS players consistently choose monitors with the highest refresh rates available.

This informal experiment is quite convincing

Does High FPS make you a better gamer?: https://www.youtube.com/watch?v=OX31kZbAXsA

A 60hz refresh rate corresponds to 16.67 milliseconds frame time, and a 240hz rate corresponds to 4.2 milliseconds.

The issue here is not reaction time, but "feel". Even a moderately skilled player can test this for themselves by switching between refresh rates. Specifically the "feel" is the relationship between moving the mouse and the shift of perspective on the screen. Low refresh rates cause players to over correct their aim as the gaps between frames are larger, and the motion on the screen is less smooth.

20ms is a bit more than one frame at 60 fps. If you still have a NES and an analog CRT tv, the best way to feel the difference is play super mario brothers for an hour on your modern tv that probably takes at least 20 ms to process rca video and display it, then play on the CRT for a while and see how much better it feels. Some things that get especially hard to do with lag, but are easy enough for most people otherwise are jumping onto a block above your head when you're on a single block, like the ? blocks in 1-1; and sliding through a one block space when you're big, like the spot towards the beginning of 1-2.

Of course, modern games are built around expecting a lot more latency in the system, but having your input a frame behind to start with, before adding render time, encoding time, decoding time, and then display processing makes for a tough experience.

Much smaller differences in latency have been shown to be relevant to competitive FPS (it's not necessarily absolute reaction time but relative to your opponents that matters). That said it's unlikely to be entirely the decider for a lot of people. Also, that kind of latency is basically the best case scenario: when you factor in a not-fantastic internet connection, location, and wifi, the user experience could still wind up quite poor in a lot of games (and it's not something which all players are going to notice consciously, they're just going to feel like the game controls worse).

Or an area that is simply not that close to Stadia's servers. Or an area on a bad backbone - like much of the world, like much of north america (maybe north america isn't Google's target audience though? ;)

Or - and this is the kicker - in an area that has lots of Stadia users. Which makes sense - more load, more demand = service gets worse. But that means that you end up with a messed up "regional playability" curve, where the best experience - if not the only good experience - is had by people in areas close enough to the servers, but where Stadia is not too popular as to be overloaded.

That particular caveat has gotten better over time, from what I understand. Throw more hardware at the problem, open more datacenters in the same region, and that helps deal with load. But it certainly left a well-deserved poor first-impression for many people.