And the regular, average people in this future timeline consider stuff like this ethically okay?
Compare to e.g. factory farming today, which also persists despite a lot of people thinking it not okay (while others don't care).
Uh, this is a human. Humans find it much harder to rationalize away the suffering of other humans, compared to rationalizing animal suffering.
Historically there were plenty of rationalizations for slavery, including ones holding that slaves weren't really people and were on par with animals. Such an argument would be much easier for a mind running on a computer and with no physical body - "oh it just copies the appearance of suffering but it doesn't really suffer".
Wiki article about the first brain image of a human upload (2031). Subpar in some respects, but initially a compliant worker and free to copy thanks to court cases ruling that the biological original did not have a legal right to restrict its use.