The ILS approach in FSX is a trivial joke. The final manual landing is slighlty more demanding in terms of attention to be payed, above all with fat boys.
The default ATC is pure garbage, it is ridicolous like the man who developed and tested it. It deserves to be burnt immediately.
Other than that FSX is IMO really a good simulator if you customize it with third part add ons, planes , scenery etc..
The ILS functions in FSX beautifully; both representing what it should be, and how it's represented in the cockpit. Intercepting the glideslope/localizer , and then chasing it down to the runway is VERY realistic. How much of a joke the whole approach might be, is up to the pilot ...
Whether or not the autopilot is used (I never do), and how realistic it can be, is also up to the pilot...
As for FSX ATC.. sure, it's buggy... but I've dealt with real-world ATC who are worse..
