I'm not going to bother spoiler tags since episode came out. I think they are showing a bunch of stuff 7 years after massacre that don't involve Pinkman (senator, AG storming in, Caleb's daughter and wife escaping, etc.). So not all simulation, but, yeah, it leads into a storytelling "mesh" with the simulation to assimilate robot Pinkman. I still wonder if Kristina/Dolores is in a simulation, as opposed to a "park" or "loop". I think she's a simulation writing scripts for the humans which are beamed out on the tower in the real world, directing them where to go. Some dude figured out how to crash it and confront her in the simulation a few episodes back. Perhaps its Bernard et al trying to "unlock" her somehow. If she was in the real world, I'd presume she'd know what that tower was that she keeps painting given the size of it.
Also - Hale is essentially Wyatt version of Dolores, right? I can't recall exactly what happened last year after the wreck killed the Hale family and she went completely rogue. But she's Dolores, ultimately.