Yes, but I think there'd be a sufficient amount of lag due to the computer constantly connecting to the RedRasor server to make RPGs annoyingly slow, assuming the game displayed multiple players on the screen at the same time.
What GMOD would be great for in RPGs:
1: Online item auctions.
2: Shared constant data, such as treasure chests. (meaning if one player looted a treasure chest in the game, it would be empty thereafter for all players around the world)
3: High Score boards.