The big restriction on that system was honestly memory, since the GameCube only had around 24MB of memory usable by the CPU. That's really what necessitated splitting up the Great Sea into chunks. Check the Chrome memory usage while that's loaded; guaranteed it'll be a bit higher.
Well nothing's simulated, it's essentially just an animated 3D model, right? Think about how complex scenes Blender can render in real-time.
It's pathfinding and AI that murder video game performance.
Some actors have simulations (e.g. Beedle's boat) but not too many right now. Compare to Super Mario Galaxy or the Source Engine games where there's even a bit of interactivity.
The most incredible example to me was pokemon snap! You could play a fun facsimile of the game
And all three islands of Liberty City from GTA III!
Even budget mobile phones are more powerful than the N64 was at the time, and this is native rendering of models, not emulation.