Is the name Simulator branded by Microsoft for use only on their games such as Flight Simulator and Train Simulator or can it be used freely, it's just I've never actually seen a Simulator game with Simulator in the title that wasn't published by MS.

No I don't think it is branded by the ms company.
As you knw there are games that are in thegenre of driving simulators or plane simulators so for the pc I think they wanted something to immulate something about simulating as a train director ot flight pilot.But there are series of a game called FLIGHT SIMULATOR 2004 for the pc though and early series of this nature.

There appears to be a couple of live trademark for games that include the word Simulator. There is also no tradmark for the word on its own. Provided you are using it with another word in a title that isn't already in use then you should be alright. As with all these things you nedd to talk to a lawyer.