Hi
I have tried to get running your project. Since i never used the processor expert it was a interesting experience too!
First to the simulator:
How i 
said the TPM does not fire or change any flags (TOF, etc.) the only thing that is working is when you set the MOD register to a value different to 0x0000 or 0xFFFF!
It would be nice from P&E to fix this bug!
I have put different service requests for that issue month ago!!
I have uploaded the now working version, but i think the ISR does not make really sense this way.
My impressions using the processor expert are somewhat 
insecure about the benefits. 
Sure it helps to get into the different 
MPUs and their 
comments. But it creates a lot of overhead as the example shows clearly!
It seems that those tools did not make any progress since i am programming and this are quiet some years now (my first 
programs are form 1981 or so!). So i prefer the handmade way.
It would be nice to have somewhat like a database, where we could look up the 
known issues for the MPU used!
Hoping this helps
Saluti Joerg