>"Though, the other reason we're not living in a simulation is that reality is continuous"

I'm not so sure that it is. Given the existence of Planck length and Planck time and other related units, it's entirely reasonable that at the lowest levels our universe is discrete, not analogue. I'll be the first to admit that it's been nearly 20 years since I've studied this stuff and I'm far from an expert, but I'm pretty sure there's no conclusive evidence that reality is continuous rather than discrete.

People believe the Planck length implies discreteness because people want the universe to be discrete, for any number of reasons (including, making symbolic and numeric methods work out). But the biggest reason to believe the universe is continuous is that it has race conditions that are indicative of analog interactions, i.e., positive feedback, rather than state-stomping.

I agree we can build plumbing complex enough that it can convince anyone, including itself, that it is self-aware.

We can philosophise about whether that's true consciousness. But that's the same directionless thought experiment as questioning whether anyone besides yourself truly exists.

I've actually thought a lot about exactly that: how can I be certain that anyone else actually exists? They could all, you could all, be NPCs populating my universe of one. The argument for this is that it takes far less computational power to render such an experience than it does to render that same experience for billions of people and all their complex interactions. But if it's one person than you simply render what they are currently experiencing. You don't render far off places, economies, environments, etc. Just focus on the individual.

And perhaps it's no simulation at all, but some super realistic form of VR (via brain implant?). Perhaps if the future world is a wasteland than this may be a way for future people to experience the "good old days." Or perhaps this is how education is conducted in the future: we live some number of virtual lives before getting a crack at a real one.

You're certainly begging the question by describing the plumbing as a perceiving subject: it can convince itself, as in, it is a subject of its own experience. This isn't some directionless thought experiment; it matters a great deal exactly what digital computers are.