Will having 20+ instances in a mobile ad monetization waterfall create noticeable latency / pre-caching issues?

This article by Vincent Fevrier from MoPub is pretty useful. https://www.mopub.com/en/blog/top-14-waterfall-best-practices-and-recommendations

Among all of the useful recommendations, here is an answer to your question:

We found that for Tier 1 countries with high eCPM average, an interstitial waterfall should have between 40 to 70 calls. For rewarded video, between 30 to 60 calls and for Banner between 15 to 30 calls. For lower eCPM country tiers, try to shorten your waterfall.

I can agress with this, as most waterfall I manage have this amount of calls as well. As you can see, it is much higher than your initial assumption of a loss of revenue above 20 instances :)

You should of course try different configurations and measure whether they are causing latency. Depending on your volume of DAU and impressions, but also on the type of app you have, a configuration with less instances can also lead to a better ARPDAU. You need to experiment !

No serious latency should occur, even with 20 instances.

On a different note, I'm not sure 20 instances are needed for a single ad location. If you didn't maximize 99% of impressions after 10, you are probably using the wrong ad networks.

In my experience, yes. But depends on the game/app: for placements that shows up from time to time it is not a big deal (like a random rewarded video). On the other hand, if your game/app constantly loads a new Ad right after the previous one, or if you need a quick load right after the application came from background, it could be an issue.