As you said, it does not definitively tell us anything about the reality in which that simulation exists other than that it has the same property that we experience of being capable of hosting a nested reality sufficient for supporting consciousness.
Although we can't specify particular aspects of that reality, we are capable of mathematically representing potential properties of universes that have the capability to host a nested simulation. None of this provides certainty, but it provides a basis of exploring possibilities, and actual understanding requires methods beyond the hypothesis of a larger reality.
Physics provides us a lot of ideas about the potential for the nature of reality and methods for testing and falsifying them but is not in itself sufficient. We don't need to find all the answers in one line of inquiry. The holographic principle of string theory is one example of a type of simulation existing inside a larger reality but far from the only one.