Simplified digital models of the Earth exist, in varying forms, for varying purposes. Google Maps and similar mapping services are the ones most used by the general public. However, even before they existed beyond the level of crude weather forecasting software, there were proposals for something far more ambitious: a “second earth”, one which is regularly updated not just with high-detail 3D maps of all locations and traffic and utilities, but also things like wind patterns, thermal effects, electromagnetic fields, and anything else conceivably useful. If anything like that is currently in development, I’m not aware of it.
It’s possible they’re referring to that concept. However, the “second earth” would not have any people in it, merely the side effects of human habitation. It would likely still be too crude to be recognizably the real world if one were somehow “inside” it, as that’s not its purpose. And even if it (or a fictional new earth made with similar technology) could be made detailed enough to fool people experiencing it via VR, it’s not like it’s particularly realistic that everyone would be forcefully jacked in like the Matrix. Or for that matter, that people would be dematerialized and uploaded like in TRON, which is probably closer to however they think that would work.