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Most likely.
Obvious this is all speculation but if you look at our world and think about how we create simulated worlds in our reality we typically create worlds based on the same physics as the world we inhabit. And we try to conserve computing power with short cuts. For example, one of the simplest things you see in every video game we make is that the computer only renders the part of the environment where your character is. So if you are outside of a building, the computer will only render the outside. It won't waste computing power trying to render the inside of the building until your character walks in.
We see this same phenomenon in our world when we look at quantum mechanics. Physics experiments like the Delayed Choice Quantum Eraser Experiment essentially confirm that our reality behaves differently based on whether we are consciously observing or we're not. Essentially when we are not looking our reality doesn't exist. But when we look it comes into existence. No different than the mechanics we currently use in our own video games. Regardless of how much our technology advances, there will always be limitations because its impossible to simulate every particle in the universe at all times unless you have a computer larger than the universe. That's why even a super advanced civilization that can create simulations as realistic as our world will have to take the sort of short cuts we use right now in our own video games.
There are a lot of holes in what you said. And some of the things you said don't apply or are straight out incorrect.
1. You have no idea what kind of computer they might be using and if anything it is most unlikely that they are using ours. Von Neumann architecture is primitive and too limited for many of the things we want to do today much-less in the future. What you wrote suggests that when we improve Quantum Computing or realize a meta-Turing model we will have more computing power than our "simulators".
Hypercomputation - Wikipedia
2. You are making assumptions about how the quantum mechanical results should be interpreted. The many worlds interpretation means that everything happens rather than nothing happens until waveform collapse.
https://en.wikipedia.org/wiki/Many-worlds_interpretation
3. As for rendering. Rendering is visual not existential so they are not really analagous. The model is where the simulated world "exists" not in the rendering. Remember: Model + View + Controller. You are viewing this with the eyes of a player not with the insight of the program writers.
Rendering is not a sign of whether something exists or not.
4. Your statement about "no matter how much technology advances" is incorrect. You do not need to enumerate all Integers for any single Integer to be enumerated. Likewise in a deterministic system (incl. a mathematical one) you do not need to enumerate all states to be able to get to any individual state.
Statement "Regardless of how much our technology advances, there will always be limitations because its impossible to simulate every particle in the universe at all times unless you have a computer larger than the universe." is in a youtube video but that video is incorrect. Our (simulated) Universe has a speed limit. If you remove that speed limit from any encompassing system (i.e. they move faster) the "infinity can't be simulated" argument falls apart. Also our Universe is digital and theirs might not be.