Is Elon Musk correct?

You’re excluding a possible middle: Different conservation laws. They don’t have to be “magic,” just different enough that we don’t understand them, at our level of simulated cognition.

You also have dismissed the possibility that we, being simulated, work at a VASTLY slower clock-rate than the time-rate of the simulators. Maybe every microsecond we experience took them two of their years to compile. We wouldn’t be able to tell the difference, but it rebuts your argument regarding energy conservation.

(Real world climate simulations work much, much slower than “real time.” This isn’t merely an hypothetical suggestion.)

What if you had ‘pocket battery’ dimensions filled with nothing but supernovae that the alien intelligence could simply switch in and out?

Or maybe that’s just what they want you to think. [Baa-baa-baaaaaaaaaaaah]