This is indeed very interesting line of thinking, and if one agrees that there is no soul, and there is no quantum process essential to life that can not be modeled on a classical computer, then this is the only remaining way of thinking.

But this is different from dictionary definition of panpsychism, because this doesn't need to assign consciousness to simpler computations (rocks, buildings, simple cells).

And this indeed opens really interesting questions. For instance if you have a simulation of many people, is it ok to continue the simulation when they are killing each other? Is it ok to ever stop the simulation? Is it ok to create a model of a person you do not like and torture him? What if your brain is augmented with a powerful computer, and torturing happens literally in your imagination?