Simulating pinches on iPad-Simulator

You should be able to see them if you hold down the Option key while clicking the mouse in the area you wish to "pinch". Also if you press press Shift-Option it will lock the two "fingers" positions relative to each other.

1. Place the pointer where you want the pinch to occur.

2. Hold down the Option key.

3. Move the circles that represent finger touches to the start position.

4. Move the center of the pinch target by holding down the Shift key, moving the circles to the desired center position, and releasing the Shift key.

5. Hold down the mouse button, move the circles to the end position, and release the Option key.

via Apple Documentation

To get the grey circles to work in iOS Simulator 5.1 for iPad, you have to set the scale to 75% (Cmd-2) or 50% (Cmd-3). Why? I don't know. Seems like a bug.