A counter-theory is that technology will always be constrained by the physical limitations of energy and matter. Given the material resources of a solar system, there's only so much you can do no matter how advanced your technology. Given that constrained matter/energy budget, how much of those resources are going to be devoted to ancestor simulations? Possibly not enough for it to matter.

Ok, you can assume an interstellar hegemonic civilization that can consume the resources of a galaxy, but if such a thing were possible how come we haven't already been absorbed by one yet? Ergo such a thing seems to be unlikely to be possible.