I have the same issue as toontan with some differences (days as well):
Actions done:
-Installed older version of SDK, current one is as advised in link installer_r23.0.2-windows
-SDK manager, installed SDK build-tools just rev.20, installed Android 4.1.2, Android 2.2, Android 2.3
-Standalone settings, saved project and under Android, for signing : selected "Sign for development only"
-Edit-preferences, selected Location of Android development SDK root
-AVD manager, selected lowest one 3.7" WVGA for device and Android 2.3.3 for target
-uncheck Snapshot, and emulator can launch.
However when i create the button and Development, test target, it says "Installation of app failed: Missing APK file"
After this I uninstalled Live Code 7.0 and installed RC2 and setup applicable areas again. When I ran the simple Button app for newbies I now received "Unable to build app for testing: apk preparation failed"
Not sure where to go from here ...