got a ping about 200, no lags

That's strange. I play on server with ping about 60 (actually I have tried few similar servers – same result) and it does not look very good. Ships do not move smoothly. They jump from one spot to another.
I have cable modem 512/256. I have checked server IP with VisualRoute. Average roundtrip time was about 80ms (max 130).
So where is the problem? Any advices?

Then it may not be ping...it might ve a bottleneck in another area (processor, video, ect...). I play on a dial-up with a GF4/4200 on an Athlon XP 2000 with 1 gig of 333mhz DDR memory...and it is liquid smooth for me all the time, even with lag (I play in 800x600 w/4x Antialiasing and 2x Anisotropic, with all settings maxed). All lag does it make the ships look like they are warping around, but it isnt jumpy at all. A lag icon for me simply means I might get dropped...but thats it.

I typically get no lag icon on Elite, even at 300ms+. It is common for me to connect at 200ms on Elite.

same goes for me too... i run a similar rig as sadisticsavior, and i don't experience choppiness even when the server, even given when ping shoots up. The little red/yellow connection box may show high ping, but gameplay itself is still smooth sailing. One exception is when I'm dueling a LCF (lag class fighter); because when your opponent is lagging like hell, he'll start to **** and move unpredictably.

Sadisticsavior what do you mean saying “ships are warping around”. Does it mean ships move from spot to spot at unnatural high speed, suddenly change direction of movement or even move back and generally moves in style which makes it … hmm hard to follow and even harder to hit? I called it jumping.
I simply compare SP mode and MP mode. They do not behave the same way.
If I may ask you a question is MP mode as smooth as SP mode in your case?

Ping is only half the equation. The other half is latency. You can have a 30ms ping to a 100mhz 32Mb RAM server and it will be laggy as mud.

Ping = network speed - high ping will mean lag for you only
Latency = server speed - slow server will mean lag for everyone equally

Right Rogue_QD. I will look for faster servers.