Compare the most advanced self driving car to the simplest insect and you should immediately realize how far we are from insect level AI.

I don't see how it could be. What can insect brains do that we couldn't get AI to do?

Pretty much everything that insects do is beyond our current AI and engineering tech. Ignoring the "engineering" feats that biological beings perform such as replication, respiration and turning other plants and creatures into their own energy source, their behaviour is very sophisticated. Imagine programming a drone to perform the work of a foraging Bee, using a computer that fits into a brain the size of a grain of rice. It can manage advanced flight manoeuvres, navigation to and from the hive, finding pollen, harvesting it, dodging predators and no doubt a dozen skills I can't even imagine.

Aside from the miniaturization, I'd be surprised if we couldn't make an exact simulacrum of a honey bee in software today, to the limits of our understanding of honey bees.

As with AI... a system can be simulated to a given level of fidelity without necessarily simulating the entire original underlying system.

This doesn't necessarily say much about the state of our AI expertise, but our understanding of honey bees is an insufficient basis for the construction of anything that would survive of be an effective member of a hive. Just a week or two ago on HN there was an article about how scientist finally have just now acquired a reasonably complete understanding of the waggling language that they use to communicate with one another. (https://www.youtube.com/watch?v=-7ijI-g4jHg)

Perhaps more relevantly, an automaton that could observe such a waggle dance using computer vision and then navigate to the food source described by the waggle seems to me to strain the bounds of our current capabilities, or maybe even to surpass them by an order of magnitude.

Bees also have sophisticated communication skills to tell other bees where to find food.

In terms of intelligence, there isn’t. What prevents us from actually building a uber-insect is miniaturization, self sustaining energy production of some kind and reproduction in an artificially built system. I guess it would be possible to demonstrate insect level intelligence by actually replacing an insect brain with an artificial one.

Your guess would be wrong. Our actual level of AGI development is maybe more on the level of a flatworm. Complex, social insects like bees are still far beyond our ability to simulate.

Controllably fly in strong wind using very primitive sensors.

What can a modern F1 tire do that we couldn't do with a 500BC wooden wheel ?