The title doesn't match the content well, everyone's responding to the title!

The syncing issue is also handled better by making the logical unit that gets changed as small as possible. If you have two people editing a document, instead of locking the document, and wiping out changes from other people, think of it as a series of edits to a paragraph, or smaller a sentence, or even the exact word being changed. If someone has text highlighted, then lock anyone else out from editing it because there is a high chance they're going to erase it or paste over it.

Lastly, as AI moves forward, it would be an interesting experiment to start having AI auto-resolve conflicts in the small. (user has been replacing the word taco with burrito, and two users started typing in the same spot TaBurrcoito. Maybe Burrito would win.

You've essentially described Google Wave style Operational Transformation.