Most of the complex simulators have settings to estimate movement heavy and add-type fights.

Regarding a target dummy, there are 3 things I think target dummies are good for

1. Working on your rotation. For example with 4.01 dropped, a lot of people had rotations changed up. Many of us took to the dummies for a bit before hitting up our first raid after that big patch.

2. Testing your own dps against yourself. You can use this to see your dps improve as your rotation improves. Or, you can use this to see if your dps goes up or down based on a piece of gear or a set of gear - something like maybe a trinket you're not sure about.

3. Testing a game or class mechanic. For example, let's say you wanted to be sure a trinket was working using dots - like maybe you think it was working on one dot, but not another. You can get completely naked except that trinket, and cast one dot at a time to test it. People do stuff like this all the time, and you can sit there and gather a lot of data using basic scientific method.

You are right in saying that dummy target dps is not indicative of raid dps, battle situations, or how good you are. For that you need to compare your own performance on each individual boss, that indeed is the true test of performance. But dummies do have significant purposes for testing both yourself, your gear, and the game itself.