Display lag is the time it takes for a monitor to process and display an image. Response time is a transition period from one state to another, like grey to grey, or black to white, etc.
If display lag is measured as 2-3 frames on a 60Hz monitor, then it is not significant even if you can see the transition because you will not be able to determine when the transition was supposed to occur. If it is 30-40 frames then that is significant.
A response time of 1-8ms is not significant, but 10-15ms could be (isn't always). A 25ms response time is not acceptable.
The problem is that no manufacturer that I am aware of will even list display lag. It is usually only a problem with televisions that are used as monitors, and that also do not have a gaming mode.
Monitors that display higher color counts (you know; the expensive ones), do not offer low response times and should not be used as 'gaming' monitors. Generally they are meant for color accurate applications and are capable of displaying a BILLION colors. They also suffer from severe (30-40frames) display lag in some cases. They are excellent at color-grading and things of that sort, but bad at games.
