Simulating something that is designed to work with thousands or even millions of users at the same time is pretty much impossible. Hot code loading and attaching to console gives you the option to see what is going on in real time and even fix it if you have to.
Now you should probably have a supervisor. Your connections could be handled by a connection or socket pool. You could have a database driver. There could be a background processing queue. Now things get interesting, not all those things get torn down and recreated on each request.
Even for short lived requests you could attached to a live system and trace one of the short lived requests or set a debug point to see what it does in "slow motion" to so speak.
One can use Erlang for quite a bit without touching the distribution (as in distributed nodes across many systems forming a single cluster). Then the shell can help you log in to any other node, transparently.
The ability to reload code at runtime is not something many systems can boast. Because that is one case you might touch once you have found the problem, but that is again one thing you can do.
You can diagnose loading and system resource utilization as well. If you have a fully-featured system (say downloaded from Erlang solutions) open the shell and type observer:start(). to start the observers. It will launch a GUI window (make sure to have X forwarding if running via SSH). There you can see runtime stats, the application tree, process list, ETS tables. For each application in the tree you can click on the process and see its state.