Looks like this is a known issue. From the Xcode 5 release notes:
After switching the minimum deployment target of an application from
iOS 7.0 to a release prior to iOS 7.0, building and running the
application may fail with the message “iOS Simulator failed to install
the application.”
- Go to the iOS home screen, click and hold the application icon, then tap the hovering “X” button to delete the application. 13917023
Another release note:
iOS Simulator
- If an iOS app is detached, relaunching the same app from Xcode will
result in a black screen in the Simulator even though the new app is
launched. Terminate the app in the Simulator or relaunch it for the
second time. 14648784