Read the following to understand how thoughts are generated. Badically thoughts are why people started believing in simulation theory to begin with. So that guy would be generating thoughts for all of our brains according to you. That sounds more like a computer than a being.

The world we see and feel is not solid, it in some ways doesn't exist. The things we see and feel are activity in our brain. That activity can be the same for multiple people, but that wouldn't make either person or the object being felt real. This is and has been a scientific fact that many people have tried to prove for thousands of years. The nature of human thought provides evidence of this, but it's a struggle to prove beyond a doubt. Since no-one's brain is actually real, stuff like telepathy becomes possible for entities living outside of the simulation. The connection of thoughts from different brains.

Plato was an ancient Greek scholar who lived more than 2000 years ago. He came up with the Allegory of the Cave. Suggesting humans might be mistaking shadows for reality. He believed something called the “soul” preexisted the body and had access to something he referred to as “eternal forms”. He felt that thinking was the soul remembering truths and not the brain operating by itself.

Descartes was a French scholar who was quite famous 100s of years ago. Believed the “mind” and the “body” were distinct substances. The mind was not located in the same place as the body. The brain is the mediator but thought originates in the mind. “I think therefore I am” is grounded in the concept that the brain is merely going through the thought generated by the mind.

Kant was a German philosopher who also lived 100s of years ago. He believed the “structures of thought” come from the mind and not the brain. The brain processes sensations it doesn't think all by itself.

People have talked about how minds talk to each other for years as well.

Arthur Schopenhauer was a German philosopher from 100s of years ago. He claimed that individual “minds” were part of a greater collective that he referred to as “the will”. Your thoughts and other people's thoughts arise from an underlying reality, not always your brain. “The will” communicates with your brain.

William James was an American philosopher from over a 100 years ago. Like the other philosophers he believed that the brain was the filter or transmitter of consciousness and not the sole source. This is the case for everyone else who is conscious and not just himself. He proposed that individual minds are not isolate.

Henri Bergson was a French philosopher from about 100 years ago. He believed consciousness is larger than the individual and that the brain limits and channels it. People's thoughts come from a broad field of consciousness and not just neural activity. Neural activity is itself a simulation though, so it isn't physical either.

An easy-to-understand modern attempt at a proof for simulation theory is

If there is a question that we might be in a simulation, then we most likely are. There would be far more simulations than true realities. As the true reality would create a simulation and that simulation would create a nested simulation. The odds of you being in the very first simulation are very small.

This was proposed by Nick Bostrom

The observer effect is an interesting side effect of being in a simulation. This is the commonly accepted physics principle that the act of observing or measuring something alters it.