I search these forums first and then the whole Internet and I couldn't figure out why I had a delay when playing with the virtual console, both with Super Mario Bros. and Punch Out. I never found the answer, however I finally stumbled across a comment about an HD TV that triggered an idea even though I only own an old CRT TV that can't even accept a component cable...
I had plugged my Wii into a DVD recorder, which itself was plugged into another DVD recorder, which was plugged into my TV. The Wii always worked fine this way, but not the Virtual Console. I am using only composite cables.
So I plugged the Wii directly into the TV set. Bingo! Instead of being knocked out by Glass Joe and Von Kaiser and losing to Piston Honda #1, I made it to Macho Man! My original NES let me down more than 15 years ago, so that wasn't too bad! I have yet to find out whether going through just one machine instead of two will work as well, but anyway, just in case somebody else had the same problem, this will give you another thing to try.
On an unrelated note, I don't know if releasing a game like Punch Out would be politically correct today. As an adult who now understands English, I was hit by all the stereotypes - but boy are they hilarious!!!