I am trying to run the iOS simulator I am trying to run the iOS simulator on my mac but I can't find it when i search in spotlight. I have Xcode 4.2 installed. I thought iOS simulator was bundled with Xcode.
Open your project in XCode. Click the Run button in the upper-left hand corner of the window.

Note that you can chose which iOS device to simulate as just to the right of that button.

If you would like just the iOS simulator, you can open XCode, create an iOS app from a template, run the app, then, with the simulator running, pin it to your dock.

The app itself appears to be in

/Applications/Xcode/Contents/Developer/Platforms/iPhoneSimulator.platform/Developer/Applications/iOS Simulator