The simulation distance doesn't seem to work as intended.
Recreate the bug :
1. Lay rails for 2+ chunks, and set ur simulation distance to 2 chunks.
2. Send a minecart on the rails
Expected :
The minecart should not proceed(should freeze) after 2 chunks due to simulation distance set to 2 chunks
Reality :
The minecart continues to move after 2 chunks
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Comments 2
^, check if the contraption is built in the spawn chunks here: https://www.chunkbase.com/apps/spawn-chunks-reader
Did you build that contraption at spawn?