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And some idiot could use MSFS to learn to fly a 737 in to the side of a building in New York.  Are you proposing we take flight simulators off the market?

I still think there would be a good market for an educational driving sim aimed specifically at training new drivers.  If I had a young teenager I would certainly welcome the opportunity to give him or her advance training in the safety of home so all the common mistakes that new drivers typically make can happen on a desktop sim rather than on the actual streets and roads.  Here's a comparison.  Numerous are the articles in the aviation press regarding the value of FS to real world pilots, how it's useful to keep instrumetn proficiency and as a familiarization tool for beginning pilots.  If FS can do that with aviation a comparable driving training sim could do that for the roads and streets. Think of it like this.  Imagine the worst rush hour highway you know.  I'll pick I-495 (DC) or I-76 schuykill expressway (Philly).  I would certainly feel better if my young driver safely negotiated conditions like that several times on a realistic desktop sim before doing it for real.

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  I absolutely agree but I wouldn't limit this to new drivers.  I think experienced drivers could stand to learn a ton through the magic of computer simulation (just as experienced pilots can learn from flight simulation).  I've been driving for about 15 years now and I'm continually learning about car control using racing simulation (Grand Prix Legends, Richard Burns Rally, GTR, etc).  I'd LOVE the opportunity to do some real world non racing simulaiton.

Car simulation has certainly improved my car control abilities and if there were programs which simulated regular city traffic I'm sure I could built up my other driving skills as well.  Certainly the new driver would find a ton of value with such a program too.  Learning to drive and getting in simulated accidents would be a valuable and cheap lesson in the dangers of speeding, running red lights, or (the cause of most accidents) not paying attention.

I wouldn't use this as a substitute for real world driving experience, nor would it be a substitute for a real world driving test, just another tool to build up the skills and confidence of the new driver in a safe environment.

Just imagine a driving in an AI controlled city where other drivers are cutting you off, pedestrians jumping in front of you, etc.  It would certainly teach you to be aware and anticipate all sorts of real world disasters which drivers are rarely subjected to.  Surviving hundreds of those simulated instances would better prepare you for the one or two real world instances you'll likely experience in your first few years of driving, when you're likely to make the wrong decisions and get in accidents.

If such a program existed I would buy it.

http://www.3d-fahrschule.de/uk_download.htm there are plenty of driving simulators out there . Here is a link to just one of many.