The other day I was flying the IXEG 737 (current version of XP 11) into Chicago's Midway (KMDW). Default ATC cleared me for a visual landing on runway 31C. I noticed in the approach page of the FMS that 31C has an ILS approach. So, I selected it and punched in the appropriate course heading, ILS freq., etc. The plane intercepted the ILS beacon and turned toward the runway. However, it never descended on the glide slope down to the runway. I assumed that I configured the plane correctly for a CAT III auto land (as I've done it before), but it didn't work.

I'm wondering--if ATC says I'll be performing a visual landing, does XP11 disable the 'virtual' ILS beacon such that a CAT III isn't possible (even though it is a runway listed as having precision approach equipment?)

(Sorry if some of my terminology is off....just an armchair pilot).

Did You activate APP when the diamant became filled for the glideslope ? Its normal practice to keep an eye on the FMA during(All the time )  this stage of an ILS approach. 

For a CATIII approach you need both autopilot and ILS setuped on both sides and before 1500 feet AGL and stable. Remember to set RA or AH for an Autoland. On the FMA you will see FLARE in White below G/S and even rollout if its a fail operationel equipt aircraft. 

In the sim (FSX and P3DV4) every runway has Cat III. 

Thanks Michael Moe 

Things to check for a 737 to do that properly, which are generally the same for either a classic, original or NG variant:

Both course windows on the MCP with the correct magnetic heading of the runway dialed in, both flight directors on, all nav radios tuned to the correct ILS frequency (easy to forget if you are used to a Triple Seven doing that automatically when you choose the approach in the FMC), both EFIS selectors for the altimeters on the same setting for both PFDs. Strictly speaking, not every one of these things is absolutely necessary but doing all this will prevent any issues, for example if your overhead has any weird source choices for stuff selected resulting in a disagreement between the left and right avionics and making the autopilots go mental lol.

Coming at the glideslope from below helps to ensure a smooth transit to glideslope capture, make sure both CMD1 and CMD2 are selected, make sure APP is selected at the appropriate time, i.e. when the glideslope indicator is one or two dots off centre. Check too, that no other settings on the MCP are overriding things and preventing the autopilots from kicking the descent in. Also probably worth checking that your sim, or the add-on is not instigating failures of systems, and if they are, either turning them off or taking over and driving the thing yourself.

Not actually necessary but good practice anyway, it's also worth setting up any stuff you might need for a missed approach too whilst you are at it, such as the necessary radio frequencies and nav aids you might require for a missed approach course dialed into the radios standby windows so you are ready to rock if the approach goes awry for any reason, such as a runway incursion, wake turbulence, windshear, a systems failure, ATC telling you to go around, spilling your coffee or whatever.

If the aircraft didn't descend on the glideslope at all the most likely cause is that you hadn't intercepted the localiser before intercepting the glideslope.

Many autoflight systems will not capture the glideslope before localiser capture has occurred (to prevent you descending without being in the area protected for obstacle clearance). Not sure whether this applies to the 737 in general, or the IXEG 737 specifically.

This is a good point Simon makes.

You were on VOR/LOC when it turned for the centreline weren't you and not just thinking you were because you were on the right heading and flying in HDG mode? I know this is unlikely but it's not inconceivable. I've done dumber stuff than that in aeroplanes lol.

Sounds like I better check my procedures. Good info guys.