
Bandwidth is unlikely to be the problem, except over a wet string network.
One of major flaws of X is the horrendous number of transactions (and
hence process switches) that it forces upon a host.  Actual measurements
(hourly average) are 5 per second per logged in user, which can lead to
20-50 or more process switches (depending on whether each event is
filtered by the window manager as well as the applications and how
many processes are needed for each character.)

While a blinking cursor needs only the application and the networking
process, and does not add any transactions, it will add something like
10 process switches per second per user.  This is a significant increase
in overhead, especially as the application may have quite a large working
set.  If you want a rapidly blinking cursor, there could be as many
as 50.

If you want to go there, I wouldn't start from here!
