Recent developments of computer technology and information and communication technology are realizing highly-distributed manufacturing systems (HDMSs) in which each machine is computerized and can communicate with other machines. For this type of manufacturing system, a distributed method of discrete event simulation and a distributed method of job shop production scheduling were proposed, respectively. Because these methods use a common distributed sequencing algorithm for HDMSs, they can be integrated and an integrated method of distributed simulation and scheduling was also proposed for job shops. This paper describes an extension of the method to flexible job shops, in which an operation is processed by one of multiple machines. A distributed algorithm for selecting the machine which processes the next operation of an intermediate job based on a given dispatching rule was proposed. By incorporating this algorithm, the conventional method can be applied to flexible job shops. In addition, a method of optimizing the machine selection by adjusting the ratio of each of multiple dispatching rules was proposed. The feasibility of the proposed method was shown by computer experiments.