For the past couple of days, I've spending some time working on a robot simulator to make the development process easier. It consists of a Win32 WPILib port (in C++) and a simulator (written in C# with the XNA framework).
It's currently incomplete, so if you know C++ or C#/XNA and you want to pitch in, hit me up over PM (or reply to this thread)!
The project is open source and is currently hosted on Codeplex.
http://frcsim.codeplex.com/
To check out the code with Subversion, use the following URL:
https://frcsim.svn.codeplex.com/svn
At the moment, it's capable of running basic robot code. Check out the "Playground" project or the "TestRobot" project for the actual code.
To compile the code, you will need Visual Studio. The express version is fine, but you'll probably have an easier time with the professional version.