Ink- You're avoiding them where you're seeing them, and in terms of big moves, the way you avoid them is generally the way it's avoided on the other guy's FE. However, I know for a fact I've been watching tracers come through my canopy from a bandit but registered no damage, presumably because lag meant on his FE he was firing slightly elsewhere. Any other plane's tracers you see are only approximately where they're actually going on his FE, which is where the hits/misses are calculated. Last night I had a prime example of this, I watched a guy firing in a tight turn with me, tracers passing through my wings, no damage. I'd bet on his FE he shot behind me. And for sure, you have seen cases where a warpy guy goes past you, then a half second later you explode due to his pass.
Semp- It's an imperfect world. Both ways of calculating it have a downside. If you do it on the shooter's FE, you get the occasionally blatantly obvious odd kill against you where you don't explode til he's past, and the like. The upside is, if you are shooting at someone and see a bullet hit, it actually hit, there's no uncertainty there.
If you do the calculation on the shootee's FE, the downside is you wind up with people seeing the enemy catch a 3 second burst on their end, and nothing happens to them. The upside, you have a greater capacity to dodge bullets defensively.
It's a better compromise to have it the way it works here, mainly due to the fact that while collisions crop up 1 or 2 times in an evening, we engage in gunnery dozens if not hundreds of times a night. Where the enemy is on your FE when you shoot is the only thing you have to rely on when you shoot. It is far better to have you able to trust that a bullet sprite on your screen from your bullet means he got hit, than to have it possibly not count because it didn't register on the other side.
Wiley.