There was software that allowed it to emulate an Apple II but you couldn't run Apple II software without first running that emulation software. So in some ways that made it more like an Apple II emulator on a Mac or PC. A IIgs will directly boot apple II software. Actually an Apple III won't run a lot of Apple II software. It won't run anything that needs more than 48k RAM or 80 column or does a lot of hardware pokes.
Actually, it may seem like it is an Apple II "emulator" because of the way it behaves, but clearly it is NOT since it actually uses the same processor as the as the Apple II. What seems clear to me is that the software required to initialize the III to run Apple II software, was more of an inhibitor/limiter as I already related it to Apple's OS X Boot Camp to run Windows on an Intel processor. But perhaps a more apt comparison is to look at efforts to put OS X on a PC. Apple has intentionally crippled the software so it will not install on a PC, despite the fact it runs perfectly well on the exact same processors. It is my understanding that Apple intentionally installed similar, but hardware traps in the III to interrupt an Apple II direct boot, and therefore the limited use of the II software had to be "enabled" via software which also defined the restrictions of the expansive hardware otherwise available to it. It seems like it only "emulated" a II in the sense it forced the more advanced hardware to behave in a more limited fashion. The fact that cards were later developed to overcome the Apple II limited operation capabilities, seems to indicate a hardware issue rather than a software one.
When you say the Apple III won't run a lot of Apple II software, do you mean software available in 1980, or software later developed for the IIe?
