I would assume it was from before. The same bullet magnetism and autoaim is in effect on LAN just like Live, and in fact both LIVE and LAN are using the same async networking with dead reckoning and all that in full effect. LAN just has a more reliable datarate, but even that wouldn't matter much since bloom is client side, not host-side. Hence why Reach 1.0 and Reach 1.1 cannot play with each other, because Reach 1.0 clients wouldn't be able to understand the CE Magnum mode or the zero bloom DMR/NR/Pistol.
It's not a networking problem, it's a perceptual problem. As latency increases, bloom has a multiplier effect on the disconnect I feel between my actions and the results. If I am firing with no bloom, the only issue is latency, which after fifteen years of online shooters, I am more or less used to. If I am firing with a flared-out reticle, my perception of where that 'bullet' has 'gone' is worsened even further because there are now two unknown variables (where the bullet actually landed, where the target actually was when I fired) playing together.
Bungie continue to test largely over LANs and over the Internet as far as, well, other parts of Seattle. Like any developer, I imagine when they do testing of suboptimal networking conditions it's considered a networking problem, not a game design problem. The question becomes "is this a fair approximation of what the game is designed to play and feel like -- what do the numbers say -- and if not, what should we do to change or fix it?" rather than "are our design decisions fundamentally ones that do not play well with the
experience of players in suboptimal (read 'typical' for those outside mainland North America) conditions, regardless of the technical 'truth' of them?" It's a qualitative problem, and most programming and networking decisions are intensely quantitative.
I love bloom in Campaign and local Firefight. I love it playing friends over a LAN. I even love it sometimes
when the host is in my favour. The rest of the time, it feels like an unnecessary layer of gauze draped over an already (unavoidably) inconsistent experience. And it's the inconsistency that bothers people -- the
perceived randomness.