In my city there is a system like this (all buses have gps, you can look where they are at any time http://www.sip.ztm.lublin.eu/Default.aspx?lang=EN ), and on bus stops there are these dynamic timetables http://rpw.ztm.lublin.eu/typo3temp/_processed_/csm_01_01_594...

It's working pretty well, the key thing is the point 4 in the article - the timetables show "in X min" if they know how long it will take for the bus to get here, or just "at XX:XX" if they don't know for some reason (transmitter or bus broke, whatever) so they just show the scheduled arrival.

So you can be pretty sure that if it says it's coming in 4 minutes you won't be waiting 30 minutes.

Clearly marking how sure you are of your prediction is IMHO more important than making very good predictions. I don't care if I have to wait 3 minutes or 6 minutes, I do care if I skip another bus waiting for a more convenient one in 3 minutes that never arrives.