To answer my own question:
I've currently got 8 people playing Guns at the same time on my crappy ComCast internet. No problems at all. I'd say GoI:O is fairly LAN Party compatible.
Unfortunately some LAN parties have a shitty internet connection or no connection at all. My own connection should be able to handle at least a full ship, maybe two, but another LAN party I attended we had over 500 ping each. Not fun.
I'm in favour of a LAN mode. I suggested it ages ago in the forums somewhere.
Heaps of other games allow you to host a listen or dedicated server. Source servers are a piece of cake: download the files, forward some ports in your router, start the server. A listen server is even easier.