I played it online in both a random match, and several matches with people in my friend roster from both my hometown, and from Texas. The lag wasn't utterly horrible, but it also depends on what's going on in the background, how big the stage is, etc. My friend and I were fine on the Eldrin(?) Bridge, but the lylat cruise was so bad for him I four stocked him. I never experienced any utterly crippling lag (except for one specific match, where I just couldn't do anything and got really frustrated). I've heard it runs pretty smooth if you're closer together, but so far I haven't played anyone within 7 hours driving distance.
I'll write down your code and add you tomorrow, I've been playing obsessively since I got home, so I figure it's time for a break (and maybe some early sleep, since last night was pretty bad in terms of not being able to sleep).