Not sure but I like it for a dry run over intended flight path, just wish they would mod it to allow full size map while flying. I do like the direct to home guide, lets you know instantly which way home is.
To answer the original question, yes - you have to have the P3 on as well to run the simulator. Please remember to leave the props OFF when inside just in case. After you end the simulation session, you have to restart the phantom before you can fly as a safety precaution.
I did find the simulator very very helpful before my first flight. As I get further along, I'm sure I'll want to practice certain moves before particular flights and could see it helpful then also.
I, for one, was really disappointed to learn I had to actually have my Phantom powered on to run the simulator. I was looking forward to practice as I rode the train to work and other spare moments. You'd think they could have written it such that it didn't require communication with the actual Phantom to function.