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To clarify again:
The server will enforce the players' rates resulting in low latency. There can be the case where it might become to much for the client. At this point however you shouldn't even play the game. Buy a new computer and/or more bandwidth.

About server specific stress:
You don't have to force the example (of 66 updates) above. I stated that whatever your rate settings for the server are (and as long as they are higher then the clients') it will result in way lower latency.

And clients using the default rates on their end has the best results. I've tested it without problems on a 64 slots full zombie server. I encourage everyone to try themselves.

However, what the pros and cons in detail are (for client and server) I don't know.

Also:
Server rates should never be default (sv_mincmdrate 10/sv_minupdaterate 10) because clients (especially back then) will not know about rates and would use the games default ones in multiplayer resulting in a bad expierence. The min value should always be 33. If you can't afford a server that can handle that, better don't make servers.

Dropping below 33 is allowed. But should not do (optimize your server, maps etc).

The same applies for clients: If you can't handle min 33 (your fps will be +/- 33), don't play the game (but that dependents on factors like players amount, map quality, graphic settings etc).

It is relative.

Nevertheless, I have to say that in the golden age of CS:S most large and popular servers had low-end settings (especially zombie servers) and people didn't bother. They could've had a better expierence however. And since 2015 or something this changed dramatically. All low-end servers died out. The few that remain are high-end - ofc the slow death of community servers is responsible for this as well.

Note: The text above focuses on CS:Source.