I think many artificial life simulations end up underwhelming because life is incredibly complex, and so it's very hard to simulate at scale. This ALiEn is perhaps the most advanced one I've seen, and it looks like even still they take some shortcuts (like copypasting interesting organisms from previous simulations together to create interesting interactions).

What you see as a criticism of this line of research I think is actually its reason: Life is arguably the most interesting thing in the universe, and if we can create it digitally it will surprise us. Evolution yields insights and solutions that you cannot predict. If we can synthesize what the minimal set of key properties are necessary for artificial lifeforms to create interesting unexpected outcomes, it helps us clarify the definition of what a non-biological organism could be.

I'm personally fascinated by the idea of autonomous digital agents that exist and self replicate while trying to earn cryptocurrency, which is used to pay for the hosting costs of themselves and their progeny. I think we are about two decades away from this being realized, but in the future, software services could self assemble, replicate imperfectly and evolve to please humans without any humans writing additional code: we'd just have to code a profitable LUCA, create suitable 'nests' and pay the organisms that please us. "What is life" is debatable, but IMO this would be a valid digital lifeform.