FYI - I solved the problem by making sure that all devices (MacBook, iPhone and Watch) are connected to the same WIFI access point. In a large space with multiple access points broadcasting the same WIFI , it is easy to not have all the devices on the same Wifi on using diifferent APs and this breaks connectivity (probably similar to the problems others have found when using a VPN). As a workaround, I ended up creating a dedicated WIFI network only on one AP just for my MacBook / iPhone/ Watch => then it works (even if I often have to force the watch to connect to the "right" AP that is technically 2 feet away). Tiry

I ended up finding the solution to the issue. The problem is located in /Library/Developer that contains the Images in /Library/Developer/CoreSimulator/Images. These images are not the same depending on the version of XCode (I think) and some reasons they do not seem to belong to the same group. This part of the FileSystem is by default ReadOnly thanks to SIP (System Integrity protection). What I did is: disable SIP (see https://developer.apple.com/documentation/security/disabling_and_enabling_system_integrity_protection) move /Library/Developer to /Library/Developer_xcodebeta start XCode 15.3 let xCode download the images again repair the iPhone => It now seems to work.

Same problem on my side with Sonoma 14.4.1, XCode 15.3, iOS 17.4.1 and watchOS 10.4 See https://forums.developer.apple.com/forums/thread/748139