But I'm at a loss to see how the foot-rock experiment addresses option (1).
The experiment is not so much meant to decide the actuality as it is meant to decide the practicality of the nature of our experiences of the world.
With option (1) it clearly doesn't matter whether it's all genuine or a completely self-aware simulation because these two possibilities are, from our individual or collective vantage, in no way distinguishable from each other, and the question becomes just as unanswerable and ultimately pointless as wondering whether we and the world were created, hale and intact in all respects, six seconds ago.
Plus Occam's Razor. Okay now?
Here my skepticism kicks in, especially given your previous sentence. We need to be cautious. Experiences happen, but it's not at all obvious to me that we can conclude there is something doing the experiencing.
That's akin to saying that, assuming it to be a simulation, it's not at all obvious that there's something
doing the simulating. How can experience and an awareness of it (with the attendant subjectivity this entails) each exist in independent and separable vacuums while still retaining their essential characters? My point here is that since you know when you are experiencing something (i.e. you are self-aware), quite apart from the perceived content of the experience, and since this knowledge is only objective to the extent that it is about your relationship to the experience, you will be left with a meta-experience, a meta-meta-experience, a meta-meta-meta-... (you get the drift) that a simulation doesn't adequately account for, unless you define experience
simply as a series of events absent any subjective appraisal, which is merely a semantic trick. But clearly experiences do have such a subjective element (if they didn't, the question posed in this thread would either not have arisen at all or it wouldn't be hard to answer).
Simultaneously and just as importantly, it is not at all clear that consciousness and self-awareness are algorithmic, which needs to be shown if it is contended that we and our experiences are simulated.
I believe the existence of experiences is enough to create to impression that "I" am something distinct from the thing being experienced, but there's no real necessity for this.
You're begging the question here: paraphrased this says, "my own experiences cause me to believe myself separable, and therefore I am able to distinguish between myself and my experiences."
Consider a character in The Sims 3 (an imagined future release), where a Sim can talk back to you and report their experiences using the word "I". This can and will be programmed. But it won't create a new entity of a different order from a database table.
Although a Sims 3 character may outwardly exhibit a wide range of (abstract) attributes, it is hard to see how consciousness or self-awareness is to be counted among them. Are you familiar with the Turing Test and criticisms of it
? It is far easier to see that the facets of intelligence (ability to assimilate new information, pattern matching, logical reasoning) measured by the Turing Test conceivably are algorithmic than that those of consciousness should be so, and no equivalent test exists in this latter context. Yet we as humans recognise it without much difficulty, and the concomitant objection that algorithmic sophistication is not sufficient still remains largely unaddressed.