Boogie, that's right but the server has some checks on the guid you try and switch to. Try and switch to one that isn't your pet, or mind controlled, and expect to be dced.
Amadmonk, of course some things don't work because the server is smart enough to not internally update your position (server doesn't trust you at all for spells), but the majority of the time the server basically just acts as a broadcaster for packets the players are sending in.
Theres a quest in howling fjord where you control this golem and collect crystals and stuff, after doing a rocket jump, just as you land, the client sees you as having a huge speed value. It's possible to move through latency before the new speed value is sent, which is pretty hillarious, you can run off the edge of the platform and jump hundreds of yards infront of you.