Let's look at a emulator as an example,
DOSBox.
Prior to the windows95 operating system (and even during) a number of games and simplified (BASIC) programs run under the MS-DOS operating system. One of the main problems of that period was bootloading the right drivers to fit within the allocate memory space of approximate 510k (While indeed some systems had higher footprints, if you couldn't get the right drivers to run in the space, you'd end up not being able to run programs that attempted to use the remaining space)
This meant that those older MS-DOS games, if you wanted to run them on a current day PC, you would need drivers for, drivers that were no longer writen for new peripherals for that old OS. Also since PC's have become far greater in harddrive space, processor size, memory size etc. The old OS again wouldn't be able to run directly on the current architecture, so this required the creation of an
Emulator.
What the Emulator does is it bridges the new hardware, architecture and speeds with limitations that fit the old architecture. It allows the creation of pseudo-drivers to assimilate running how they would have run in the old MS-DOS environment and allows old MS-DOS programs to run. Obviously occasionally there are a few "glitches" where various things aren't proportional in scaling, however when such bugs occur the emulator development team (to my knowledge) attempts to refine their programming to remove the glitch.
Basically an Emulator in this instance is a Virtual recreation of a system that would only run on a Legacy architecture. While the interface to the emulator is GUI and allows for people to tweak it how they want to fit what ever application they apply, it in essence is a DOS box within another OS's shell.
You also have to take into consideration that the Emulator in this instance allows you to run Legacy media like it would have been run on Legacy architecture. This isn't something that would occur in a Simulator.
Simulators come in many forms, for instance you can suggest that a chemistry lab will use a simulation to support a hypothesis, however they still have to collect and process data to create the simulation, which doesn't necessarily have everything included. (sometimes there are extreme instances where some value isn't considered or other values are inputted wrongly) Simulations in some respects are therefore a cut-down version.
There is also the factor in philosophy of querying "What is Real?", if we conclude that some games are "Simulations" that involve the needless death of the virtual peons, understanding the world to be a "Simulation" might conclude to some that nothing is real and therefore why should they care if people die. This could obviously result in traumatic occurrences were some idiot picks up a gun and starts blapping away at his classmates.
So in some respects it needs to be understood how to distance this virtual confusion so that such people don't become radically confused about what consequences exist in the world. They need to understand that the world is "real", even if it is an "emulation". Like I have pointed out using DOS box, an emulator can interface with the "real" world and use "real world data", so terming the world an Emulation as opposed to a Simulation is just to try and save some people from suffering psychiatric breaks that could be dangerous to others.