This cached information does get updated in certain instances (restarts, significant network changes detected), but that does not always happen on both machines.
Example
Device1 (IP 12.34.56.78), Device2 (IP 12.34.56.79) are on VLAN1, Device3 (IP 12.34.67.89) is on VLAN2
Device1, Device2, and Device3 connect to each other and cache Display Name information for each other
Device3 gets reassigned to VLAN1, gets IP 12.34.56.79 while Device2 gets IP 12.34.56.80
Device3 (IP 12.34.56.79) connects to Device1 (IP 12.34.56.78)
Event from Device1 in PSC Console shows Device2 for IP 12.34.56.79 instead of Device3 as there were no network changes on Device1 (cached info is used)
Device1 is rebooted, resetting cache
Device3 (IP 12.34.56.79) connects to Device1 (IP 12.34.56.78)
Event from Device1 in PSC Console shows Device3 for IP 12.34.56.79