This is not true at all. The real advantage has always been low ping in MO1, and it still is in MO2 although to a lesser extent now due to the normalization system.People with 300 ping have always been competitive and borderline had an advantage. What u say is pretty moot.
Not being able to block attacks at all in MO1 was more of a con than the advantage of looking a bit laggy. You also have to remember than the lag you see a high ping player having, is how everyone looks to him, so there is no advantage.
In MO2 however, there can be problems when someone has high packet loss, only that has basically nothing to do with ping and the worst offenders of this do it to themselves on purpose.
High packet loss players will be booted from the server, Henrik has said.