Oh yeah, now I remember why there's more input lag with frame interpolation turned on. Taking a shot right now and now it pops into my head.
Anyway, it's because while the frame interpolation adds more frames per second, the "I-frames"—or real frames—you're seeing are lagging behind one I-frame. This is because it can't start showing you interpolated frames until it has two frames it can interpolate between.
So you won't start seeing I-frame N-1 until I-frame N (the latest I-frame) has been generated, thus creating extra input lag.
Someone correct me if I'm wrong, I'm supposed to be asleep...