I suspect that a full universe simulation of all of space-time, fifteen billion years of an entire universe, may have a cost complexity such that it could never be realized in any currently conceivable computer due to speed of light limitations. Even a galaxy sized black hole may not be sufficient. You are talking about a Tipler-like scenario that would probably require some massive re-engineering of the entire universe. I can't rule this out, but from what I've read of astrophysicist's reactions, it is questionable whether it is possible even in principle to collapse the universe in the fashion required. (Tipler figures it requires tachyons in his later response writings)
So no, that would not be much easier to simulate - it would be vastly more difficult, and may not even be possible in principle.
The more likely simulation is one run by our posthuman ancestors after a local Singularity on earth, where they have a massive amount of computation, enough to simulate perhaps a galaxy or galaxies full of virtual humans, but not the entire history of our universe. We must remember that they will want to simulate many possible samples as well. They will also probably simulate hypothetical aliens and hypothetical contact scenarios. Basically they will simulate future important sample time-slices.
Today humanity as a whole spends a large amount of time thinking about the present, slightly alternate versions of the present, historical time heavily weighted based on importance, and projected futures. We already are engaging in the limited creation of simulated realities. The phenomenon has already begun, it started with dreams, language, thought and is more recently amplified with computer simulation and graphics, and just chart that trajectory out into the future and amplify it by an exponential vastening . . . .
This is not the ordinary simulation argument, or even closely related to it. The proposition that you reject, that our universe is simulable in its entirety, is one of the premises of that argument.
I for one strongly predict that our future ancestors will never create a galaxy or multiple galaxies of virtual humans from their own past. It's ethically dubious, and far, far from being one of the most useful things they could do with that computing power if they simply want to determine the likely outcome of various contact scenarios or the what hypothetical aliens would be like. By the time we're capable of it, it simply wouldn't have much to recommend it as an idea.
Many folk here on LW take the simulation argument (in its more general forms) seriously. Many others take Singularitarianism1 seriously. Still others take Tegmark cosmology (and related big universe hypotheses) seriously. But then I see them proceed to self-describe as atheist (instead of omnitheist, theist, deist, having a predictive distribution over states of religious belief, et cetera), and many tend to be overtly dismissive of theism. Is this signalling cultural affiliation, an attempt to communicate a point estimate, or what?
I am especially confused that the theism/atheism debate is considered a closed question on Less Wrong. Eliezer's reformulations of the Problem of Evil in terms of Fun Theory provided a fresh look at theodicy, but I do not find those arguments conclusive. A look at Luke Muehlhauser's blog surprised me; the arguments against theism are just not nearly as convincing as I'd been brought up to believe2, nor nearly convincing enough to cause what I saw as massive overconfidence on the part of most atheists, aspiring rationalists or no.
It may be that theism is in the class of hypotheses that we have yet to develop a strong enough practice of rationality to handle, even if the hypothesis has non-negligible probability given our best understanding of the evidence. We are becoming adept at wielding Occam's razor, but it may be that we are still too foolhardy to wield Solomonoff's lightsaber Tegmark's Black Blade of Disaster without chopping off our own arm. The literature on cognitive biases gives us every reason to believe we are poorly equipped to reason about infinite cosmology, decision theory, the motives of superintelligences, or our place in the universe.
Due to these considerations, it is unclear if we should go ahead doing the equivalent of philosoraptorizing amidst these poorly asked questions so far outside the realm of science. This is not the sort of domain where one should tread if one is feeling insecure in one's sanity, and it is possible that no one should tread here. Human philosophers are probably not as good at philosophy as hypothetical Friendly AI philosophers (though we've seen in the cases of decision theory and utility functions that not everything can be left for the AI to solve). I don't want to stress your epistemology too much, since it's not like your immortal soul3 matters very much. Does it?
Added: By theism I do not mean the hypothesis that Jehovah created the universe. (Well, mostly.) I am talking about the possibility of agenty processes in general creating this universe, as opposed to impersonal math-like processes like cosmological natural selection.
Added: The answer to the question raised by the post is "Yes, theism is wrong, and we don't have good words for the thing that looks a lot like theism but has less unfortunate connotations, but we do know that calling it theism would be stupid." As to whether this universe gets most of its reality fluid from agenty creators... perhaps we will come back to that argument on a day with less distracting terminology on the table.
1 Of either the 'AI-go-FOOM' or 'someday we'll be able to do lots of brain emulations' variety.
2 I was never a theist, and only recently began to question some old assumptions about the likelihood of various Creators. This perhaps either lends credibility to my interest, or lends credibility to the idea that I'm insane.
3 Or the set of things that would have been translated to Archimedes by the Chronophone as the equivalent of an immortal soul (id est, whatever concept ends up being actually significant).