I've just installed Titanium 1.0.0. Mac OS X 10.6.2, iPhone SDK 3.1.3 freshly installed.
All my iPhone projects run just fine in the simulator, and I can create a new Titanium app project test & package it with any of the simulator it will compile and run it in the simulator and immediately exit, leaving the simulator with a blank black screen.
All the Titanium projects do this, including KitchenSink. Yet I can open the new project folder I just created and in the build/iphone folder open the xcodeproj file in XCode and it will build and run in the simulator just fine, as will KitchenSink.
Here is a dump of what the Test & Package window says in Debug mode:
"I was able to resolve this, by opening xCode and changing in preferences under 'Building' the option for 'Place Build Products in:' back to 'Project directory' I had originally changed this back when I was using xCode for development along with SVN, so my build wouldn't be put into my SVN repository.."