The ‘outside’ reality only needs to be the size of a data center, not the entire universe. And maybe the outside reality only needs to be a trained 100gb model. A much simpler outside reality than we have now. You don’t even need to sim 8 billion people, just 1, you.
Occans razor in this case applies to the complexity giving rise to a situation here though, not the complexity of a described system.
Conventional physics giving birth to our universe is currently the model with the fewest assumptions.
What would have to take place to give rise to a universe the size of a data center, running an AI model of a human? It feels like we have to bake in assumptions of stable physics, a rise of a stable system for that data center, and some path towards creating it and modelling a human.
That said, if we believe we're capable of running billions of believable simulations, then we're more likely to be in such a simulation than ground reality. But a datacenter pocket dimension bakes in a lot of assumptions that make it less likely than our own universe.
The outside universe doesn’t require our complex particles or physics - all that is overkill to run a neural net. Also think of all the data we can store in a fingernail, stable diffusion is like 4gb, what could a 4tb model produce?
You only need a universe the size of a data center with nothing in it but a bit of vacuum fluctuation that causes particles to appear sometimes. Then just wait.