So I loved this part of the game, I just finished the quests, and that had to be one of the coolest tings I've seen in a videogame. 
 
I just had one question, how did everyone stay alive in there pods for like 200 some odd years? And why was it a big deal I mean they'd be dead already right? 
 
Also how come he makes you kill everyone? That'd leave him all alone, he gladly lets you leave after that, but if you operate the failsafe he gets mad?

Everyone was being tended to by the care robots and life support i assume, and if someone dies by standard means inside the system, he (the crazy doctor) can just bring them back by altering the program, since its only their virtual manifestation that died. However, activating the failsafe shuts down all systems, allowing the captive people to die on real world terms (thus the system not having any way of scanning them back inside the program), and leaving the him alone in the program forever, being locked out of the command console. He didn't have any physical form, being that he died long ago. He only existed as a faux AI from when he uploaded his own mind into the computer system. I think I've got all the facts straight on that, anyone feel free to correct me if somethings wrong.

Yeah, that was one of the better parts of an amazing (but very buggy) game. The explanation for why they stayed alive for two hundred years is simply that they were being held in a form of stasis that allowed them to be kept alive indefinitely. It's a big deal because at the end, you get to choose whether or not to euthanize the entire population of that vault after basically killing their minds in the simulation. That choice was one of the move grave and poignant in the game, I really liked it. Lastly, he wanted you to kill everyone because he had toyed with the residents of Tranquility Lane for two hundred years. Everytime he killed off all the residents, he would just reset the simulation in another locale, with all the residents restored to life with no recollection of what happened. He was getting bored of making the residents suffer, so instead he wanted to make your character suffer. Activating the failsafe permanently kills off the residents, which would leave him all alone in that virtual paradise he created. He realizes this and understandably becomes upset.
(he deserved it)
Hope this helps

Yeah, great quest. I agree with the comments above =)

Science. :I

I really like the game so far even if it is kinda buggy

"So I loved this part of the game, I just finished the quests, and that had to be one of the coolest tings I've seen in a videogame.  I just had one question, how did everyone stay alive in there pods for like 200 some odd years? And why was it a big deal I mean they'd be dead already right?  Also how come he makes you kill everyone? That'd leave him all alone, he gladly lets you leave after that, but if you operate the failsafe he gets mad? "

I just finished playing through this section on my third playthrough. Everyone who's posted has it right. That's why if you kill someone within without him asking (or with him ask, depending on what part of the quest is active), they respawn as soon as you speak with him.
 
Also, that quest series is easily the best in the game, all DLC included.

That was the most memorable thing I've ever done in any video game. 

" @hack745: When old lady dithers was talking to me and the first time betty changed her voice I got chills "

the most interesting part of the game without a doubt and my favourite. i tripped balls when i went to get my pip boy up on my wrist only to find a school-boy watch come up instead. my reaction was something like "HUHHHHHHHHHHH!?!"