This is a great post, I've never understood the idea that VPN's make people have better connections.
I always assumed most used them to get around any restrictions their country or provider might have in online gaming.
Well, actually, a VPN can help reduce latency by allowing you to direct your traffic closer to an end point rather than utilising an inefficient route that goes the wrong direction as dictated by poorly implemented DNS routing in a distant region.
Such as we in Aust/NZ/SEA are currently forced upon us via Akamai's Hong Kong Prolexic DDoS scrubber.
A gaming VPN does reduce my pings and improves stability to ESO. Without it, I could not play the game.
I agree with your security concerns surrounding VPNs though, especially the free VPNs and TOR. Those are a great way to lose your personal identity, banking details and credit card numbers.
I will only use a reputable, private, paid for VPN service.
I work in and have experience in many different areas and ran a underground VPN a while ago so i have a extensive set of knowledge, this ping issue that while connected to a vpn will lower ping isnt always clear, in fact some VPNs will restrict the amount of internet usage out of your machine by restricting certain apps to not broadcast. There are a lot of reasons why a VPN will make it look like you have a better connection then you do, some days the server you reach is not so loaded. Other days it is VPNs will still increase ping even if its by 10ms it still will. Just know this and stay away from free vpns.
"Home Network" -> (Sends a Packet out) -> "Stops at VPN server for encryption" -> (Packet sent out again this time encrypted) -> "Arrives at destination encrypted" | -This action took 120ms to complete as it had to make a extra stop at the VPN server for encryption BEFORE heading to its final destination-