I am using GCC version 3.4.1 with dwarf-2 output and AVR Sstudio 4.10. When I run the code using the Studio simulator for the Mega169, I can't debug the C++ constructors. Breakpoints never hit, and if I try to "step into" it actually does a "step over".
There is an easy workaround though. If I put the code in another function that is called by the constructor, I can debug that.