Through my work (shameless plug: www.dotproduct3d.com) I've assessed a fair number of "Time of Flight" 3D sensors (which also use flashes of IR light -- but aren't really time-of-flight but that's another story) and, while generally pretty cool, all of them so far have suffered more or less severe multi-path effects. Which is why stereo / structured light or single-point LiDAR are still better for a lot of use cases. I can't wait for these MPI problems to be finally solved.
It should be a smaller problem than with the Kinect. The Kinect is not true time of flight like you said, whereas ouster is. If you know when photons actually arrived you know the first light pulse you receive is the one you care about, and the later longer paths you can ignore. The Kinect conflates these.
So, I don't think it will be a problem for them but it is something they need to consider when designing their DSP.
The reality is somewhat more complicated than that. Signal processing at this level is statistical in nature, so the threshold itself is effectively timing-driven.
Hard to explain in a few words, but the principle of the lock-in amplifier is a good place to start.
I still don't understand how there is no threshold based on amplitude (correlation or not). Something like mist would show up as a noise floor, a speck of dust (that hangs around for long enough) may be one peak, a mirror another, and an object seen in the mirror will be another. You will have multiple peaks that may stay around longer than others and, but there will still be peaks, one of them being the "true" surface.
https://www.microsoft.com/en-us/research/wp-content/uploads/...
I wonder if Ouster is susceptible to this. There's no mention of it, but I imagine it will be a bigger problem as they add more lines of resolution.