That command has been broken since... well, I'm not really sure it ever actually
worked.

There is nothing wrong with you system... at least that would cause that problem.
To test a mission created in FRED:
Save the mission.
Place the mission in Freespace2/data/missions.
Open FS2 (it doesn't matter whether FRED is still running)
Go to the Tech Room on the main menu.
Click "Mission Simulator".
Now go to the bottom of the screen. You should see two boxes marked "Campaign Missions" and "Single Missions".
Click on "Single Missions".
Now select your mission and get testing!
Note: if you did not give your mission a name in the Mission Specs Editor in FRED, it will simply appear as "untitled".
Another Note: this assumes that you are running FS on Windows. I do not know if there is anything terribly different on a Linux install.
Also:
