Of course, I don't know whether we're living in a computer simulation any more than you do. No one does, at least not anyone living in our reality. But the idea does actually make some things about the universe more understandable. For thousands of years, people have seen God as someone cruel, arbitrary, and incomprehensible, someone who creates disasters and causes--or at least allows--billions of people to die and suffer for no apparent reason. The general perception of God has long been that of some inscrutable entity whose decisions and motivations are beyond all human comprehension. But if you imagine God as someone kind of like a modern-day computer programmer, perhaps with some physical differences but overall not too different in terms of social or emotional motivations, then this perspective gives us a new way to think about God, because we can imagine God as being motivated by the same things that motivate our own game designers who create virtual-reality worlds. If we think about God as not being too different from us, we can suppose that God's reasons for doing things would not be too different from our own, and we can find some answers to the questions of the universe not by looking wistfully at the stars, but by looking within ourselves. The question becomes not "What would Jesus do?", but rather "What would you do?" How could you make the best possible world? If you were a game designer creating a virtual world for virtual beings to live in, what decisions would you need to make for that virtual world? If you could play God and design your own universe, what would you need to do to make that universe a success? When you think about this, things become much clearer, especially if you are a game designer who has a lot of experience playing and designing games that attempt to create fully-realized virtual worlds.
In most "God games", you start off with just the world but not people in it. (In the beginning God created the heaven and the earth.) You can then add some people, usually just a couple of people who can then start building their own homestead and family. (Adam and Eve.) The world is beautiful at first and everything seems happy for a moment, but it doesn't take long for conflict to start building up between people even in a very small community. (Cain and Abel.) And then you're faced with the question of what to do with this conflict: Do you execute righteous and omnipotent justice? Do you just smash the troublemakers and let the peaceful live? That seems to work at first, but has tragic long-term consequences, because if you eliminate one person making trouble, another will just pop up, because it's in people's nature to fight. Eventually you realize that just executing bad people isn't really a viable long-term solution, because "good people" and "bad people" don't exist; anyone can turn good or bad depending on the circumstances they're in, and so you come to understand that you need to allow people some leeway to do their good and bad things, because otherwise they'll never learn, and they'll never have a chance to show who they really are, or to learn the consequences of their negative actions.
And so you give people some freedom. You give them room and time to do their evil things, because people learn from these actions and events. They begin to understand the human motivations for these things, and they realize that although some people are very different from each other, in their hearts they tend to be motivated by the same things, regardless of who they are and how they live. Really, if you just stepped in like an overprotective parent every time your simulated population screwed up, if you just wiped away any troubles and provided them with an endless supply of whatever they wanted, would they ever really have the chance to grow, to develop and learn and become responsible adults instead of coddled babies who just demand whatever they feel like at any moment in time?
Perhaps a more fundamental question is: Do people really want a "perfect" world where nothing ever goes wrong, where everyone is always healthy and happy and there are no challenges or problems to confront? Remember one of the most fundamental lessons of The Matrix: People rejected the perfect Matrix. People refused to live in a world where everything was perfect. Perhaps human beings simply aren't built for that kind of existence: "I believe that, as a species, human beings define their reality through misery and suffering."
Or perhaps such an existence is inherently unsatisfying, because there's nothing to do in it. There have been computer games that exist without challenges, without conflicts, without the threat of death, and most people find such games to be boring, because there's nothing to do but pointlessly exist within that game's simulated environment. No matter how beautiful that environment is, it gets old fairly quickly if there isn't anything to do in it.
And so you'd have to make people work. Do people really want a life where they can just lie around and do nothing and have everything given to them? Are people really satisfied by endless supply, where everything they could ever want is immediately available and magically appears at the push of a button? They may think they want that, but people who actually have such lives just complain all the time. What people really seem to want and need is a life in which they have to work for everything, a world in which nothing comes to them for free, but where they have to sweat and strain in order to receive anything. If rewards come to them too easily, they complain that the game is not challenging enough, and they stop playing. The life that people want is not one of traipsing naked and carefree through the daisies while singing, laughing, and clapping. They are only satisfied with a life in which their own toil brings them rewards.
So you set up tasks for people, make it necessary for them to work in order to survive: "If any would not work, neither should he eat." And life becomes a struggle to survive, but though people might not realize it, they're happier this way, because the need to work distracts them from their existence. Perhaps counter-intuitively, it turns out that many people actually enjoy grinding in video games, doing the same task over and over to produce some kind of useful output, and so if it satisfies them, let them do it. What else are they going to do? In a world of endless possibilities, what are people going to do once they get bored of those endless possibilities? They repeat the same task every day, because then they stop worrying about what they're going to do with their life.
But it's not enough for people to just work for a living. People want adventure. That means danger, and there is no danger without death, or at least the possibility of it. So you give people disasters and threats, and let them build things to deal with those disasters and threats so they can feel like they're in control of their lives, so they can feel like their own ingenuity and hard work caused them to conquer the worst that the world could throw at them. People want to go on grand adventures that carry the risk of death, people want to battle some mighty foe. People need to fight someone, to be against something, but not only that, people need to feel threatened. People don't just love adventure stories where the hero is threatened by death, people love epic disaster stories where all of humanity is existentially threatened by something, like a disease pandemic, or an asteroid slamming into the planet, or global thermonuclear warfare. And so you give people regular doses of these existential threats, because then it's an adventure when people escape them. People say they are afraid of humanity being wiped out, but when humanity emerges out the other side, it's a happy ending to a thrilling story.
So, again: What would you do? If you had the opportunity to play God for a while, how would you make the best decisions? Would you ensure that every person is constantly healthy, happy, and carefree? Or could it be that Leibniz was right after all, and that ours really is the best of all possible worlds?
The problem with religion through the ages has not been that it advertises the existence of a fictional deity, but rather that it completely misunderstands the nature of that deity. If there is a God, then God is not that different from a regular human being. Whoever built our universe knew what they were doing, and if you ever think that God made a mistake, just think of any disaster movie, and imagine how the movie would have unfolded if, once the threat had been revealed, someone had said "Whoops, sorry, false alarm... It isn't really a problem at all, we fixed it". If you think that people would be satisfied with such a movie, then you don't understand people at all. People live in a cage of their own creation, because it is the cage they want to live in.