I wasn't considering packets per second. I was only looking at the bit rate. I guess peer to peer won't work for any large scale miltiplayer action game.

There are all sorts of problems with using peer to peer for this kind of thing. A server that is aware of all the state can optimize all kinds of stuff that you cannot do with p2p. For instance what if you only want information on objects within a certain radius? A server that knows where everyone is at can just send you what you want, p2p wouldn't be able to do that. And then you get into who do you sync against and how, and all sorts of other problems that are fairly straight forward with a server, but really hard with p2p.

The problem with just comparing a simple theory of which method is more bandwidth efficient completely ignores the fact that one of the methods simply doesn't require sending as much data to solve the same problem.

The wall you always hit with games like this is client bandwidth (and to some extent latency they go hand in hand). Every other problem is basically solved, but you hit the bandwidth/latency wall so fast that you never even get a chance to see how far you could push everything else. Using p2p just means you will hit that wall much faster.

I'm not saying it wouldn't be fun to play around with, but I just don't see how you could ever overcome some of the obstacles there, or even if you did how it would be better then server authoritative. It's one of those things that sounds cool but in practice just doesn't work well.

The wall you always hit with games like this is client bandwidth

Actually, in my experience, the wall you hit with "massive" online games (and even not-so-massive ones) is all the content you have to build. You could have a working engine and networking setup handed to you on a platter, and building a game is still a significant challenge!