This seems a lot more feasible. In fact, that's what the Nvidia Shield essentially is (although the edge computation is done with the customer's desktop computer).
I see this as being a more plausible implementation for say multiplayer twitcg shooters. Market needs to scale up a lot for this to be viable though...
CDNs are deploying compute/lambda at the edge capabilities, so "gaming at the edge" could be seen as a reasonable expansion of that.