I was doing the same yesterday, I was able to compile it. Not sure if what I did is the right thing since I don't have experience with XCode, but here we go.
First, I use the codebase from the latest AppGameKit update, which I believe you're also doing.
I notice errors when trying to use cSprite.mm and also (Box2d-something, don't have it here right now). I just remove both from my project tree. They were in scrapper folder, but it seems they weren't necessary or they are been referenced somewhere else.
After fixing this error, the compiler was trying to link with libAGKiOS.a from Debug-iphoneos folder instead of the Debug where it is actually placed. For that, due to my dumbness, I actually renamed the folder accordingly.
I hope it helps.
Cheers
Paulo
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Paulo
http://www.mobilecreators.com