Earlier quoted context omitted.
Check out the original simulation argument paper[0]. The issue is, if we think we are heading to a world in which we can do simulations, it becomes increasingly likely that we are in one of those (presumably very many) worlds, rather than in the one world that existed before the advent of such simulations. [0] https://www.simulation-argument.com/simulation.pdf
Sounds good because it seems like it explains what our reality is, but it really doesn't. It just pushes the fundamental problem up X simulations into the supposed "real reality". It also assumes that simply simulating a universe would generate consciouss beings which nobody knows the answer to, but my guess is that it would not.
Remember in this case the simulation is not running a model of physical reality - it’s only running a neural net that is fed into your senses.
In that case there are no ‘atoms’ it’s just a concept fed into your mind. Just like in dream it’s hard to question reality, you just go along with it.