m2lagfix does work with any amout of units. the 8 player requirement was/is for the live spectator feature.
please note: flickering cars most likely happen with framesync=0 (or not defined at all) in m2network.ini
you could try framesync=1 first, but you will most likely get network hiccups (all games freezing for like 1-3 seconds) every now and then.
try these...
m2network.ini #1
[Network]
RxPort=9101
NextIP=127.0.0.1
NextPort=9102
FrameSync=1
m2lagfix.ini #1
[m2rx]
LocalHost=<network ip #1>
LocalPort=7001
RemoteHost=127.0.0.1
RemotePort=9101
[m2tx]
LocalHost=127.0.0.1
LocalPort=9102
RemoteHost=<network ip #2>
RemotePort=7002
m2network.ini #2
[Network]
RxPort=9201
NextIP=127.0.0.1
NextPort=9202
FrameSync=1
m2lagfix.ini #2
[m2rx]
LocalHost=<network ip #2>
LocalPort=7001
RemoteHost=127.0.0.1
RemotePort=9201
[m2tx]
LocalHost=127.0.0.1
LocalPort=9202
RemoteHost=<network ip #1>
RemotePort=7002