It's not unrealistic, even F1 uses it. Only they can't display a ghostcar on the road. If they could, I'm sure they would!
They use the datalogging for comparing the laptime, to the the previous lap, but also to the fastest lap, simply by a 2D presentation of the track and cars. A ghostcar is an easy and fast way of comparing the datalogs.
Computer simulation provides these tools that are not possible in the real world, why not use that? LFS is a 'realistic' simulator, it's more realistic than NeedForSpeed. But is far from realistic compared to the real thing, where you don't press the resetbutton if you hit the wall with 200km/h...
It's not that time consuming from a programming point of view, the car is displayed as usual, only the collision detection is turned off. Not that hard to do I think.
And for the argument that some drivers with less tallent would do 2000+ laps and beat the record, simply add a lapcounter, so you can see how many laps are done for setting that time...