I think the issue is quite simple.
All interactive formalisms can be simulated by Turing machines.
TMs are inconvenient languages for research on interactive computation (in most cases) because the interesting issues get drowned out in
the noise of encodings.
Everybody working on the mathematisation of interaction knows this.
Let me explain this in more detail.
Turing machines can obviously model all existing interactive models of
computing in the following sense: Choose some encoding of the relevant
syntax as binary strings, write a TM that takes as input two encoded
interactive programs P, Q (in a chosen model of interactive
computation) and returns true exactly when there is a one-step
reduction from P to Q in the relevant term rewriting system (if your
calculus has a ternary transition relation, proceed mutatis mutandis).
So you got a TM that does a step-by-step simulation of computation in
the interactive calculus. Clearly pi-calculus, ambient calculus, CCS,
CSP, Petri-nets, timed pi-calculus and any other interactive model of
computation that has been studied can be expressed in this
sense. This is what people mean when they say interaction does not go beyond TMs.
If you can come up with an interactive formalism that is physically
implementable but not expressible in this sense, please apply for your
Turing award.
N. Krishnaswami refers to a second approach to modelling interactivity
using oracle tapes. This approach is different from the interpretation
of the reduction/transition relation above, because the notion of TM
is changed: we move from plain TMs to TMs with oracle tapes. This
approach is popular in complexity theory and cryptography, mostly
because it enables researchers in these fields to transfer their tools
and results from the sequential to the concurrent world.
The problem with both approaches is that the genuinly concurrency
theoretic issues are obscured. Concurrency theory seeks to understand
interaction as a phenomenon sui generis. Both approaches via TMs simply replace a
convenient formalism for expressing an interactive programming
language with a less convenient
formalism.
In neither approach genuinely concurrency theoretic issues,
i.e. communication and its supporting infrastructure have a direct
representation. They are there, visible to the trained eye, but encoded, hidden in the impenetrable fog of
encoding complexity. So both approaches are bad at mathematisation of
the key concerns of interactive computation. Take for example what
might be the best idea in the theory of programming languages in the
last half century, Milner et al's axiomatisation of scope extrusion (which
is a key step in a general theory of compositionality):
$$P|(\nu x)Q \ \equiv\ (\nu x)(P|Q) \quad\text{provided}\ x \notin fv(P)$$
How beautifully simple this idea is when expressed in a tailor-made
language language like the pi-calculus. Doing this using the encoding
of pi-calculus into TMs would probably fill 20 pages.
In other words, the invention of explicit formalisms for interaction
has made the following contribution to computer science: the direct
axiomatisation of the key primitives for communication (e.g. input and
output operators) and the supporting mechanisms (e.g. new name
generation, parallel composition etc). This axiomatisation has grown
into a veritable research tradition with its own conferences, schools,
terminology.
A similar situation obtains in mathematics: most concepts could be
written down using the language of set theory (or topos theory), but
we mostly prefer higher level concepts like groups, rings, topological
spaces and so on.