You need to design your game around these trade-offs. Is shooting in your ARPG really that precise? How often will that scenario present itself / do monsters move about erratically?
I think you are right. I don't need shooting to be super precise, so I might solve the issue by having hitboxes big enough to compensate for the fact that the event is being executed later. I might even enlarge these hitboxes only when an entity is moving, thus still having fairly precise collision detection when an entity is standing.
How often will that scenario present itself / do monsters move about erratically?
I think it is another fair point: enemies at the moment tend to not move too much, as long as most of them have ranged attacks, and the ones who don't usually come straight to the player and stop when close enough.
PvP will still be an issue with the approach above, but I think that I could design the PvP-related networking system in a slightly different way, so that it is more precise and compensates for lag.