Hey,
I can not use an iPhone with iOS 16.4.1 with the latest version of Xcode. As Xcode shows the message "Failed to prepare device for development. This operation can fail if the version of the OS on the device is incompatible with the installed version of Xcode. You may also need to restart your Mac and device in order to correctly detect compatibility."
Added OS 16.4.1 Folder in the Device Support and perform the following steps.
Delete the app from the phone
Clean the Build Folder with: ⌘ + shift + K
Delete derived data
Disconnect iPhone
Restart iPhone
Restart Mac
Connect iPhone
Below are screenshots attached
Please have a look into this issue.
Thanks