Using live flight data in MFS

I have an engine which outputs live coordinates and altitude of an airplane. I want to render the flight data using Microsoft Flight Simulator. I already looked into the SDK and saw that you can for example set the current altitude using the simvar PLANE ALTITUDE.

I have multiple problems implementing the solution. First, my engine outputs position flight data somewhat infrequent so if I would directly modify the plane position it looks like the plane is teleporting around.
Second, I would also like that the control panel displays realistic data such as engine rpm. The engine does not simulate that information itself.
Third, the flight data has to be extrapolated. If the engine outputted a coordinate altitude pair the plane should not just stop there. It should fly ahead according to the last direction until new data is generated. It is okay if the plane teleports a bit here to adjust the extrapolated position to the next real position.

I found out that MFS can load preexisting .PLN Flight Plan files and it is possible to let the plane automatically follow the route using the AI piloting feature. But I can not use this because I have live flight data which is not known ahead of time.

How would I go about implementing that? Do I have to program my own physics simulation to extrapolate the position and to get instrument data?

I’m not sure exactly how they do it, but I think your engine needs to take an average of the data points received and mathematically plot a course which is an approximation of the real time data with a slight delay. Obviously the FSTL and AIG teams have had to deal with this, they may be able to give you some pointers.