I actually can’t find now where C7 compatibility was confirmed for SNES, was maybe mentioned in passing in some Shmups forum post. Also, BahnYuki has always tested SNES before on various displays, so I’m pretty sure he would’ve explicitly mentioned if there was some problem with the C7.
You can read about the jitter in the Shmups thread where Marqs presented his solution, leading to the current de-jitter mod board (basically, there is a short scanline every other frame in 60Hz mode). The OSSC itself does not drop signal due to the jitter, but quite a few displays has problems, as you are aware. Even on a display that is compatible, the jitter can be seen as some horizontal instability in the top-most lines (talking very up close, it’s not visible at regular viewing distance (at least for SNES)).