so,
ignoring the energy space logic and mathematical problems of running a computer that simulates a universe particle by particle and proceduraly generates all interaction instantaneously and concurrently..
and that this computer is capable of spontaneously generating, destroying and rearranging matter to simulate the universe it inhabits
there's a flaw with this idea, and it's pretty simple:
this is not how you describe a computer, this is how you describe the observable universe
everything is physically linked so it is a system, a system of substance
but it is certainly not a computer simulation because by definition a computer program has no observable substance beyond the logic it is made of
personally i think it's just a bizarre twist of logic that humans fall into that because the observable universe is built on blocks that it must be part of something bigger or else, because we build things from blocks too maby that's just how things are
besides, if some alien or super-sized human has nothing better to do than simulate me farting while i sleep in a mega reality engine then frankly he has more energy and free time than sense