Do printer controllers take inertia into account when interpreting G-code into movement instructions?
Stepper motors &quot;want&quot; to keep their position as they are told to by the firmware, therefore they do whatever it's needed (accelerate and brake) to follow the orders they received.
The question is: is the firmware telling them to move/accelerate/brake faster/harder than they can? if yes, they won't keep up (because of inertia and much more) so you'll see artefacts. If not, they will follow the orders exactly (well, mostly, but it's not important now) and no distortions will be there.
Whether they keep up or not is up to you: you are setting their power (the motor current) and you are telling them how fast/hard to move/accelerate/brake. If you push them too much, the motors will try... and fail to keep up. That's why you have max acceleration, speed, jerk in the firmware and in the slicer.
Additional info: even if the motors keep the position as they are told to, the motors have no knowledge of anything past them: belts, leadscrews, and so on.
Imagine the X axis belt (which connects the motor to the printing head) is made of an elastic band: the motors will be where you order them to be, but the inertia of the printing head will stretch the elastic band and the printing head will NOT be where you expect it to be.
It is again up to you to reduce the max acceleration to a value below what the motors could be able to do, if needed. Motors are often not pushed to their limit also because other factors cause issues before the motors fail.
How to know how much to limit the acceleration and speed? the only way is trying.