Hope it's okay to make two Traveler posts in the same day! I thought it would be more helpful posting as a separate question for people searching on this topic in the future.

If you allow aging for foreign SIms as "true," my understanding is that it ages them each one Sim day and then they "catch up" once you're back in their homeworld. Does this mean that if you have a Sim who needs aging up a few times, it will age them up sequentially? For instance, if you leave behind a baby as a baby for the amount of time it takes for them to age up to a child, when you return will the baby get aged up to a toddler and then a child after that?

Thanks.

That's correct. But unless the world in question is way overpopulated so that there is a tremendous amount of catching up to do, the player isn't typically likely notice any of this happening while it happens. As with so many other things, players' mileage may vary.

Just a heads up, if by ”allow aging for foreign sims - true” you mean ageless foreign sims > true then that does the opposite. Ageless should be set to false if you want other worlds to continue aging while not in the world and have it update on return which it should be by default I believe anyway.