This! You figured out what is wrong and what is causing it, but Apple do not seem to be fixing anything. I cannot listen to music or watch anything while working with Xcode and previews. So I just wasted 500+€ for airpod max headphones? They should add a setting in xcode, to disable audio and let us use audio for other things...

I can confirm that excluding architectures makes more problems. For example we have excluded arm64 test targets in our project and when some of us got M1 mac, we couldn't get code coverage from simulator run. To solve this I have removed excluded architectures from all targets and also make sure to update cocoapods, some updates removes this excluded architecture setting for arm64. Right now everything is working I get even test code coverage from simulator all running natively on M1 :)

I sent report over feedback assistant, now we wait :)

I can confirm, still not working in beta 2. Anyone reported this to Apple?

Well fun thing will happen in one year time, when transition to AS will be complete and there will be no more Rosetta to use... Really this should get fixed. Another workaround is to run tests on real device - that way I get all coverage.