I have an app that I need to test 3 finger touches and 2 finger touches, is there a FREE application that allows me to use 3 finger instead of being limited to only using 2 fingers like in the simulator?
iSimulate by vimov might be close to what you are looking for. I've sent the question of three finger touches to their support. Unfortunately, it is not FREE ($15.99) and requires you have an iPhone or iPod Touch to use it. You do not need to be a signed up developer though.
UPDATE: I got the following reply from support:
Yes, iSimulate works with up to five fingers which is the limit of iPhone touch screen.