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Desrtopa comments on Theists are wrong; is theism? - Less Wrong
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To uploads, yes, but a faithful simulation of the universe, or even a small portion of it. would have to track a lot more variables than the processes of the human minds within it.
Optimal approximate simulation algorithms are all linear with respect to total observer sensory input. This relates to the philosophical issue of observer dependence in QM and whether or not the proverbial unobserved falling tree actually exists.
So the cost of simulating a matrix with N observers is not expected to be dramatically more than simulating the N observer minds alone - C*N. The phenomena of dreams is something of a practical proof.
Variables that aren't being observed still have to be tracked, since they affect the things that are being observed.
Dreams are not a very good proof of concept given that they are not coherent simulations of any sort of reality, and can be recognized as artificial not only after the fact, but during with a bit of introspection and training.
In dreams, large amounts of data can be omitted or spontaneously introduced without the dreamer noticing anything is wrong unless they're lucid. In reality, everything we observe can be examined for signs of its interactions with things that we haven't observed, and that data adds up to pictures that are coherent and consistent with each other.