Sorry SE, but endgame won't work if you don't fix something.

[Earthen]

I'm really curious why not make the AoE damage something client-side. I mean, let the client do all the calculations and send the result to the server. It makes cheating easier, but ends this annoying problem.
Basically, when the client receives information about AoE, the client checks if the player is inside the area or not. When finished, send results to server and the player takes the hit or don't.

PS: Probably unfair for PvP, but just talking about PvE and dungeons here.

Nothing affecting actual game results can be client side, or cheating begins immediately. What they probably do need is a bit more leeway in the cast times, they should be a bit longer to compensate for lag issues. Additionally, and I don't know how feasible this is, but having the clients issue a position update more often at least during certain parts of the game like boss fights in dungeons, could help.