I am running it like this, with the SDK installed, and the Pocket PC version maps copied over.
In MediaCar, you have 2 ways of running Destinator. The preferred way is to choose "Destinator" from the menu that pops up, or set it to always use Destinator. Don't enter the .exe name into the "External Application" box, as that will more than likely not work properly (i haven't ever tried it)
Give that a go, and if not, post back.