Armitage still works and is still maintained (32 releases in the past year -- I'm on it). Make sure you're using the version that ships with Metasploit.
One note though, its dependencies have changed recently. If you use msfupdate, Armitage will no longer work with BackTrack 4 or BackTrack 5. BackTrack 5r1 is OK though. This is because the original msf install in BT4/5 does not include libraries that Armitage requires (msgpack, Java crypto extensions, etc.)
If you use a modern version of Armitage, it will open a tab and use the Metasploit console to launch exploits. At least you get feedback this way.
I have a Windows XP SP2 target that I use for demonstrations too. Sometimes it becomes unstable and I find I have to revert it to a previous snapshot to exploit it again.







GCIH - GIAC Certified Incident Handler : Passed my GCIH




