How accurate is the inflight location information? I'm wondering how accurate the location information displayed on the in-flight entertainment system is. As I recall, it always shows quite direct routes, such as this:


However, I'm wondering how accurate this information is. I can image that because of ATC the route will not be as smooth as displayed above. Does it simply show a predetermined route as function of time?

More towards a specific case, would the people onboard the Malaysia Airlines MH370 be able to see the changed course of the aircraft?
The route is actually quite accurate; it is derived from the navigation system of the aircraft. You can determine your departure and arrival routes pretty well from the inflight entertainment system if you are familiar with the routes on the airport you are flying. 

In the image in your question you can see a slight course change East of Newfoundland. This is where the aircraft entered its oceanic track. 

If the system was operating on MH370, it would have shown the course change as well. 

Below you see what the IFE showed on 11 september 2001 when aircraft heading towards the USA were not allowed into US airspace after the attacks. 


Source: airliners.net