In order to simulate reality one might need to have some idea of what reality is.

People don't agree on what reality is.

The universe is a seamless whole. There are no isolated parts of the universe that don't interact with the rest of the universe outside them.

When you try to simulate reality you are limited by the size of storage and computational speed to trying to simulate only small parts of reality.

If you simulate a city block sized area, then how do you explain the gravity ? If you just say it's by fiat, then you aren't simulating reality very well. If you include the body of a planet in your simulation then it will need to behave as if it where a real chunk of planet material of some sort. If you come to the edge of your city and can't go any further, how do you explain that within the framework of your simulation?

One part of many description of reality deals with macroscopic objects, the sort of objects that one sees in daily life on earth , the cups and saucers and books and baseballs and such. These objects appear to behave in somewhat the manner described in Newtonian physics. Thus to do a good job of reality simulation one needs to simulate macroscopic objects of the sort one sees in everday life. One also encounters substances in reality, so one's vr system needs to simulate substances.

Reality can be seen from different levels, focusing on areas and time durations of varying extent. In reality one can focus in on a onion skin with a microsope and some dye and see the cells and and cell components, so in a virtual reality, if you've got onions, you'd best have some cells, and you'd best have some microscopes too.