The current trend is to count the hit. Its very frustrating for the shooter to make a valid hit under the crosshair and miss. Whereas the player that moved has no real obvious way to tell exactly where the player aimed. If this was a defensive move like a shield, then its up to the game mechanics to decide that sort of thing.

> If player A receives the rollback, and now witnesses B dodge

Why would they witness the dodge? They would likely see the VFX of the hit and then the target move slightly faster than they should for a frame.

> from the perspective of the server, the state of the game in which A landed the hit never existed

You can validate that player positions and visibility raycasts and such that you're verifying plausibility. You say "the state never happened on the server" but what does that even mean? You're not replicating look rotation with enough fidelity to know that and its not the job of the server to simulate "what actually happened." The point is to make a fun game so its fine to reward the player.