They specifically claim to refute the 'simulations all the way down' anthropic-flavored argument which goes as follows:
-
We can make pretty good simulations already
-
Later we'll want to make more and more detailed
-
Therefore most folks that exist are inside simulations
-
Ergo we're probably in a simulation
If our universe allows us to build more powerful computers, then this argument goes through just the same as it did with Church-Turing.
(I agree with your broader point: every thing our universe does is a new requirement on the universe simulating ours. But I don't think this is a particularly relevant observation for the 'are we in a simulation' question? Anything our universe does is tautologically something a universe can do.)