Use Xcode 7 with iOS 10

You can use any SDK on an older build of Xcode simply by copying and pasting the folder of the OS you need. Also you obviously cannot have two apps with the same name so just rename them to Xcode 7 and Xcode 8.

right-click / ctrl-click the Xcode 8 application icon to show the package contents and navigate to this location and copy the iOS 10.0 or WatchOS 3.0 folder etc.

/Applications/Xcode8.app/Contents/Developer/Platforms/iPhoneOS.platform/DeviceSupport /Applications/Xcode8.app/Contents/Developer/Platforms/WatchOS.platform/DeviceSupport

Then navigate to the same location in Xcode 7 and paste the folder.

/Applications/Xcode7.app/Contents/Developer/Platforms/iPhoneOS.platform/DeviceSupport /Applications/Xcode7.app/Contents/Developer/Platforms/WatchOS.platform/DeviceSupport

Restart Xcode 7. You'll have to wait a while for Xcode to rebuild the symbols etc.

You need use DeveloperDiskImage from Xcode 8 Beta. For this extract Xcode 8 Beta app and copy DeveloperDiskImage for iOS 10 to your Xcode folder.

Suppose you extract Xcode to Downloads/Xcode-beta.app

cp -r /Users/fanruten/Downloads/Xcode-beta.app/Contents/Developer/Platforms/iPhoneOS.platform/DeviceSupport/10.0\ \(14A345\) /Applications/Xcode_7.2.1.app/Contents/Developer/Platforms/iPhoneOS.platform/DeviceSupport

After copy DeveloperDiskImage you should start Xcode and connect iOS device to your mac.

Edit:
With a standard Xcode install one can create a soft link:

sudo ln -s \
/Applications/Xcode-beta.app/Contents/Developer/Platforms/iPhoneOS.platform/DeviceSupport/10.0\ \(14A5309d\) \
/Applications/Xcode.app/Contents/Developer/Platforms/iPhoneOS.platform/DeviceSupport/10.0