No, I think that's exactly what Musk is saying.No. No one is suggesting anything like that. That’s why I cringe when you reject these ideas. I’m not sure you fully understand them.
Here's an indirect reference to this from Nick Bostrom, who gave Musk the idea, I think. Musk thinks the odds are much higher than Bostrom who puts it at 20% and thinks the Holocaust is one reason we might NOT be living in a simulation.