Reading this reminded me of an article in the IF Theory Reader [1] called "Crimes against mimesis" which talks about not breaking the plausible consistency of the game world. I find it interesting to note that the first VR worlds were text-based, VR chatrooms have existed since the time of MUDs, and we are facing some of the same problems each generation!

[1] https://www.ifarchive.org/if-archive/books/IFTheoryBook.pdf