If I correctly recall, the way that Game Boy Advance backwards compatibility works is that there is essentially an entire Game Boy Color CPU on a chip inside the Game Boy Advance, and there is a switch in the cartridge slot that detects if you have a Game Boy Advance game or a first generation Game Boy / Color game plugged into the cartridge slot. That's why you get a Game Boy Color boot screen when you plug in an older game instead of a Game Boy Advance boot screen.

So, when you put LSDj or another program on the proper cart, it's actually running on the internal Game Boy Color in you GBA, versus running on an Emulator on the GBA.