This working paper distinguishes metaphysical Simulation Theory from Practical Simulation Theory: a model-mediated account of how living beings perceive, remember, communicate, coordinate, and act through layered simulations arising from within reality. It argues that “fake” is the wrong frame; perception is modeled contact with reality, and the practical task is to govern models so they clarify reality rather than replace it. The essay develops a layered mediation arc from biology and perception through language, media, the internet, AI, and institutional consequence, then introduces model-hardening as a governance problem. This working paper is part of the broader PUTMAN / Spanda architectural framework for model mediation, weak-signal interpretation, and governed consequence.