And are you absolutely sure this doesn't happen in normal Quake 2 server? See where I'm going here... ?

. I think what you are describing is a side effect of how grappling hooks and such work in the Quake 2 engine - normal Q2 prediction would pull the client to the ground as a result of gravity, so grappling hooks temporarily send a "turn off prediction" message. However since by the time the client receives this, they are already part way through the grapple movement on the server, they will experience a slight prediction miss which may be the slingshot/bounceback you are experiencing.