I found out that for some reason, /Library/Developer/CoreSimulator/Volumes/watchOS_20R5287q/Library/Developer/CoreSimulator/Profiles/Runtimes/watchOS 9.0.simruntime/Contents/Resources/RuntimeRoot/usr/lib/swift/libswiftCloudKit.dylib is not a file, but a symlink to /System/Library/Frameworks/CloudKit.framework/CloudKit - which is a folder, not a file, and as a result, any app that uses CloudKit crashes instantly after start on my WatchOS 9 and iOS 16 simulators.
On WatchOS 8.5 and iOS 15.5 sim everything works. Can you confirm if this is a known bug? I tried redownloading the simulators, but the result is same.