The approach we have taken for this vehicle is to provide a core Simulator class that can be used with a simulator interface class to provide simulation in a variety of situations:

With the ExternalSim interface, one runs SimDaemon on a server, and the ExternalSim runs in the control cycle (on either host or target) to provide a simulated environment (including environmental values). Same code-base runs on either host or target (although a #define must be set to avoid errors due to missing hardware on either the host or a bare-bones target).
With the InternalSim interface, the Simulator object runs locally, and provides a full simulation of all control sensors between GPS fixes. This will be a valuable input to the CBIT component.
With the NavigationSim interface, the Simulator component also runs locally, but the real sensor readings are fed back to the simulator when they are available – this provides a high-fidelity dead-reckoning.