This was tricky, but I think I finally figured out a way to make it work. Here are the steps I followed. I installed both GNS3 and Dynamips/Dynagen from SourceForge (http://sourceforge.net/project/showfile ... _id=235898
Before launching GNS3, launch the dynamips server from SourceForge. Then:
1. Under GNS3 Preferences > Dynamips > Dynamips > Executable path, type the path for the dynamips bin file in the package contents.
2. Under GNS3 Preferences > Dynamips > Hypervisor Manager, clear the "Use Hypervisor Manger When Importing" check box
3. Under IOS Images and Hypervisors > IOS Images, double click the image in the image window. This should populate the image filename in the image file window.
4. Click on the External hypervisors button
5. Ensure that the default settings are selected (127.0.0.1, 7200, 10000, 2000)
6. Highlight the settings in the right pane of the window
7. Click the save button
8. Go back to the IOS Images button
9. Clear the "Use the hypervisor manager" check box
10. In the window immediately below that check box, highlight the entry that is there. It should be 127.0.0.1:7200
11. Click the save button
I'm still working out the details of configuration, but I can open a console session from the GUI, which opens in the standard terminal.
It worked for me, that's all I can say.