His second hyperbolic argument seems to me to be wrong or irrelevant

Agreed. (I like your essay about junk food art. By the way, did you ever actually do the utilitarian calculations re Nazi Germany's health policies? Might you share the results?)

I don't really follow.

Me neither, I just intuit that there might be interesting non-obvious arguments in roughly that argumentspace.

Omega as in the predictor, or Omega as in Chaitin's Omega?

I like to think of the former as the physical manifestation of the latter, and I like to think of both of them as representations of God. But anyway, the latter.

beyond the first few bits due to resource constraints

You mean because it's hard to find/verify bits of omega? But Schmidhuber argues that certain generalized computers can enumerate bits of omega very easily, which is why he developed the idea of a super-omega. I'm not sure what that would imply or if it's relevant... maybe I should look at this again after the next time I re-familiarize myself with the generalized Turing machine literature.