It is based on the individual's experiences and opinions. So it is subjective.
Lag isn't based on individual opinions. Their feelings and experiences may vary on the lag, but that doesn't mean the lag itself is subjective. Their opinions on the way the lag effects them is subjective, because some might think it hinders them worse than others might think, but if both players are seeing things happening a second (or half a second, just an example) later than it is, that delay is not subjective or based on opinion.
owiseguyo asked how would people cheat? Well, there's ip flooding, there's lag switching, etc. There are plenty of ways that people can cheat to win more games, thus earning more xp and getting higher in their division.