We can already simulate worlds replicating the drudgery of everyday life, it's called "The Sims". Seriously though, if you break down normal matter far enough, you'll effectively find 'pixels', and between those pixels is nothing, just empty space. I have no doubt that a computer of the future can create an entire universe, but as for our universe existing solely in on a computer, it's a moot question. Just like asking, 'what if only I exist and everyone else is a figment of my imagination?' You can't prove or disprove it, it's just an interesting thought experiment.