This is your problem, you think "objectively real" actually means something. It doesn't, sorry to be the bearer of bad news.
I think the sim is a world -- not a real world, just a world -- which can seem real to the beings inside it. I didn't call them "actual" beings because that doesn't mean anything either.
The mechanics are simple: Just simulate every single particle in their world, using rules identical to the rules of particle interaction in our own world.
How would their subjective experience of their world not be equivalent to our subjective experience of our world? Just tell me how they would feel different. Don't blab on about "but it isn't real" because they don't care what you think, it *feels* real to *them*. How is their perception of what is real to them different than your perception of what is real to you?
Suggesting that because you know they are in a simulation from our point of view they are somehow less real from their own perspective is just an absurd proposition. If there is a God, and he tells you "you should not consider yourself real, because you are existing in a world that is a simulation from my perspective" would you say "oh, I guess I am not real then?" No, of course you wouldn't, that is just absurd. You would likely say "you are wrong, I am real, see I exist in my reality." So what gives?
Yes, "objectively real" does, in fact, mean something.
And pointing to the uncertainty of the quantum foam is a red herring, because we don't need to concern ourselves with that level of magnification.
When the parents tape the drawing of the sleeping baby to the door, there's a real sleeping baby in the house, and there's a piece of paper with ink on it on the door. That's objectively real.
If you want to argue about that, you'll have to do it without me, because your'e entering into discussion-busting philobabble at that point.
Now, when the housekeeper arrives, the light reflecting off the paper enters her eyes and sets off a cascade of neural events in her brain which, we don't know how, cause the idea of "there's a baby sleeping inside the house" to pop into the housekeeper's head.
That idea, however, is imagination. No new baby is created in the process.
What's objectively real is the neural activity in the housekeeper's brain.
And these are the only two realms we can discuss... what's going on in the world of matter and energy that we're a part of, and what we imagine.
(Btw, discussions of the limations of our senses are also a red herring here.)
There is no "world of the representation" with a baby in it. It simply does not exist. There's a piece of paper with ink on it taped to a door, and there's a thought in a woman's head. But no "world of the simulated baby" with any claim to reality.
And because such a world does not exist, it simply makes no sense to inquire about the properties of its inhabitants.
The same is true if we make a sculpture of the sleeping baby, or an animated cartoon, or a computer simulation. In these cases, what is objectively real is the stone, or the celluloid, or the computer. And that's all. And they're all behaving like stone, celluloid, and a computer (respectively).
When I look at the carved stone, or light projected through the moving celluloid, or lights changing on the computer's monitor, it causes my brain to think of a sleeping baby. But there is no real baby, and no new world for that baby to exist in.
There is only this world, and our imaginations.
So no, you can't run a simulation and then talk about what the inhabitants of that simulated world think or feel, because there is no such world to ask about, and no such folks to ask about.
There's a computer doing what a computer does, behaving in essentially the same way it behaves when it runs simulations of rivers or epidemics or anything else. And there's your imagination which is triggered to think about human beings when you observe the simulation, which is not flesh and blood but lights on a screen or ink on paper or the vibration of a speaker cone.
That's all there is in this world, my friend, when you do what you're describing.
It's you taking your eye off the ball, I'm afraid.
You gotta keep your feet on the ground and your mind out of the ozone.