Sorry if I was unclear, I didn't mean to imply a link between "real time" in the game/simulation and the real world, because you are completely correct in noting that there is no specific relation between game time (ticks) and "real" time (seconds or w/e units you want).
The link in the "time" that I am describing is one where the game graphics are rendered in 60 frames per second. If the computation cannot be completed within 1/60th of a second, the frame is delayed because it took too long to render.
My comment was largely in response to your assertion
"If you have enough resources to lazily simulate the entire observed universe, you probably have enough resources to consistently simulate the entire observable universe."
First, assuming that it requires less resources to "lazily" simulate something than to fully simulate it, then no, I do not believe that just because you can do the first means that you can 'probably' do the second. If you had enough resources for the first and not the second, but the first was good enough, why not do the first?
In response to: "With that said, why would you simulate something so ridiculously large and detailed if you only had the resources to run a small portion of it at a time? It's like buying an 8K 3D monitor and hoping your 3DFx Voodoo 2 will do the trick."
The reference to animation was largely in response to this, because that is exactly what the purpose of animation is. They have enough resources to render the animation in whatever length of time it takes to render, but they can't do it quickly enough to just render it frame by frame for the viewer.