Well, look. I don't think this is a controversial statement. The AI in sims of the past are generally better regarded than the AI in today's sims. It's not because the older ones were more sophisticated or "simmed" it better. Modern day AI surely is probably doing a lot more things than those old ones. But the end result of older AI - from games like Grand Prix 4, GTR2 and GPLegends, hell even super old school dos-based Grand Prix 2 - is that they were more successful in.. um, "immitating" or "faking" the behavior of actual people. They fooled us better than the current sims.
And the reason is probably because the stuff being simulated was more paired down, simpler, easier to code and manage. There was more parity between the player tire model and what the AI was doing. So now, in modern sims, the tire model are so complicated, they've outpaced the fidelity of what can be achieved by the AI. So my opinion is that, for the sake of gameplay, for the sake of replicating human behavior more successfully, things like the tire model need to be simplified. I don't know if GTR2 also didn't have any AI tire wear - but if it didn't, they faked it more successfully than pc2 did. And I think SMS knows this, which is probably part of the reason they nixed tire wear entirely for pc3. One less variable for the AI to fake, one less thing to break immersion and be a "tell" that you're racing against bots.
I understand all "AI" in these video games are all faked and not true AI, as your video demonstrates. I'm saying you can have better results faking the AI if you go back to the fundamental established in older sims.