@Gmuxx, very interesting topic. Working in the data analytics and machine learning field I read a lot on predictive algorithms and predicative learning. When I hear people, like Elon Musk, saying that we live in a simulated universe I cringe a little.

Life and reality are not products of a simulated universe. As we see in VR, a form of reality could be simulated, to a certain extent, but for us to be living in a simulated universe it would be far to complex to consider rendering.

There is a paper in Scientific Advances that talks about quantized gravitational responses which boils down to the lack of particles in the universe needed to simulate particles in the simulated universe. Read the paper for more information - it's very interesting but pretty deep physics.

Back to the first part of the comment. Our brains are huge advanced predictive machines. Studies have shown that we actually predict outcomes milliseconds into the future. This allows our brains the ability to react and anticipate the physicality of the world around us. Simplistically we can see it in action when a baseball player catches a hard line drive; the player's brain predicts the trajectory of the ball and its placement at a specific time and our physical body reacts.

To further the argument that we do not live in a simulated universe the massive circular predictions that would have to take place would simply overburden the simulation. As our brain calculates our predictive actions the simulation would have to out-predict us or we would see glitches constantly as we make unpredictable (by the simulation) actions. You would constantly be walking into walls or doors, falling down stairs, spilling your coffee and having undecipherable conversations.

As a philosophical discussion it certainly has some of the same flavors that one would come across when discussing religion and the deniability (or if you are in the other camp the certainty) of a supreme being having created us and the world around us.

Great topic Gmuxx.