This hole still bothers me. And I would have preferred if the story had turned out to be about VR-pleasure machines.
The matrix could have been created to run worlds where humans could get hooked into and be happy ever after. Only, regulation processes would have discovered, this would devolve into gross realizations where the humans would want ever more extreme satiation of all senses. And in the end they still wouldn't be happy, just addicts. Eventually the machines reverted humans back onto the treadmill they knew from the earlier human culture, the best way the found to keep humans balanced: merrily running after the next carrot.
In this telling the matrix is just the machines following the original order: make humans happy.
> reverted humans back onto the treadmill they knew from the earlier human culture, the best way the found to keep humans balanced: merrily running after the next carrot.
Our "rat race" turns out to be a very stable equilibrium ...
Neil Gaiman (in "Goliath," from the Matrix comic series, collected later in his "Fragile Things" anthology) said that humans linked to the Matrix were used as processors, not batteries.
I suspect the writers left this plot hole on purpose. They want you to think about the meaning of it all while alluding that the system uses humans as a source of power.
Try rewatching the movie as a statement on our society and how the system uses human beings or discards them into the sewage when they choose to unplug. As you watch Neo slide out of his pod, think what would happen if you stopped going to work.
When Morpheus shows what the Matrix is for the first time, he shows it on TV! This is how you're plugged into the Matrix. Even now, you're reading this on a screen.
In many ways, the message is not to trust the system, but instead believe in your intuition and in yourself to break free. Just free your mind.
The real explanation: the original script used humans as a source of compute power (some quantum brain crap stolen from "Hyperion") but was later changed to batteries because audiences are dumb.
I wouldn't look too much into it. It's fiction. They went for a story that works. They probably chose the premise of the virtual world first. And it worked, it's a really iconic classic. I don't know how many times I've watched it.
The sequels not as much though.
However I find the conclusion and alternative solution from the article quite good.
The biggest plot hole is why would machines need to stay on or below the surface of the Earth. They could launch themselves into space and get all the (solar) enery they could want that way.
The matrix could have been created to run worlds where humans could get hooked into and be happy ever after. Only, regulation processes would have discovered, this would devolve into gross realizations where the humans would want ever more extreme satiation of all senses. And in the end they still wouldn't be happy, just addicts. Eventually the machines reverted humans back onto the treadmill they knew from the earlier human culture, the best way the found to keep humans balanced: merrily running after the next carrot.
In this telling the matrix is just the machines following the original order: make humans happy.