I do not understand the supposed situation of our bodies being held elsewhere with all of this being but a simulation.
[The idea of it is easy enough to grasp - why, just take The Allegory of the Cave at face value - but Sebastian means he doesn't understand the science behind how it's made possible. That's well over a century of scientific progress to catch up on before he can even begin to make sense of it.
The Wardens mention The Other Dome and all of this being a dream in their welcome message. Lelouch seems sharp enough to not have glossed over that, or Sebastian would be more careful about throwing something like that in his face.]
Yet if it's true, I would assume additional facilities, or indeed more dimensions right in our midst, would be child's play to make possible.
[Maybe it's not, but it all seems about equally sci-fi to Sebastian. That still leaves the question why this specific clique of people is held in this prison.]