Remote Desktop Gaming I am not sure if this is the right forum for this, but here goes. 

I have a 2011 Thunderbolt iMac which I love dearly for it's beautiful display. Long story short, I know that there is no way that I can use it as a monitor for my gaming PC, but I was wondering if it would be possible for my iMac to control my gaming PC via the Remote Desktop Application or would there be too much lag? (both machines are on the same network so this would be done locally)

I cannot try this yet because I am still in the process of getting my PC back, but I am seeing this as the only viable solution at the moment other than just purchasing a monitor for it.
While this is theoretically possible, if you care about frame rates at all you would not do Remote Desktop for gaming. You would have a hard time getting frame rates above 15fps.

Remote Desktop is meant for logging into work computers from home, or controlling headless servers, not gaming.