Papyrus sims have the best replay system I've used. You have full control from frame-by-frame to 16x in either direction, plus they're very smooth, even for multiplayer. The game recors full 6DOF postion of each car for every frame, plus at least in NR2k3, it stored some data for telemetry analysis as well. Of course, the size... An online race of 10 driver with a half hour of practice and then a 45 min race could easily be a 70+MB file. The same thing in LFS is 4MB...
Frankly I'd rather have the control than tiny files, but I suppose the LFS, and most other developers, disagree. :/