Let's just ignore questions of consciousness entirely and think in terms of decision-making systems, which may or may not be conscious, and which have sensory inputs, some self-knowledge or introspective capacity, a capacity to make causal world-models, etc (all those things can be given a purely functionalist definition).
What then does "talking in terms of simulations" mean? It means that the decision-making system needs to consider, in choosing a world-model, worlds where it (the decision-making system) exists at the physics level - at the lowest possible level of implementation, in a given ontology - and worlds where it exists at a level somewhere above lowest possible - that is, in a simulated physics several layers of abstraction removed from a fundamental physics.
I strongly doubt that you're going to be able to derive the Born rule by just thinking about a decision theory that worries about whether you're an nth-level simulation, and doesn't concern itself too much with the nature of physics at the bottom level. Back on Earth, we didn't derive the Born rule from any sort of apriori, it was chosen solely on the basis of empirical adequacy. But if you are going to derive it by reasoning about your possible place in an apriori multiverse (think Tegmark level 4), then you simply have to concern yourself with the distribute of possible bottom-level physical ontologies. Even if it turns out that simulations, and simulations of simulations, are frequent enough in the multiverse, that you must give those possibilities significant consideration, I don't see how you can get to that stage without going through the stage of thinking about bottom-level physical ontologies.
Agreed, you need something like a basement to get a baseline, at the very least a logical basement as a Schelling point. There's not a non-circular obvious decision theoretic reason why you or why cosmological natural selection would 'pick' the squared modulus as a Schelling point. But it's sort of like property rights; we emerged out of Hobbesian anarchy somehow, and that somehow can be at least partially "explained" with game theory, social psychology, or ecology. Ultimately those all feed into each other, but I wouldn't consider it fruitless to choose one approach and see how far it takes you. Does this analogy fail in the case of deriving the Born rule?
These are extracts from some Facebook comments I made recently. I don't think they're actually understandable as is—they're definitely not formal and there isn't an actual underlying formalism I'm referring to, just commonly held intuitions. Or at least intuitions commonly held by me. Ahem. But anyway I figure it's worth a shot.
A proposal to
rationalizederive magick and miracles from updateless-like decision theoretic assumptions:(On Google+ I list my occupation as "Theoretical Thaumaturgist". ;P )