JChecn37's advice about switching to bash and back to zsh fixed my problem! You're a lifesaver!

The issue still happens for me with Xcode Version 12.3 beta (12C5020f). I will note that, 12.0 - 12.2 Playgrounds will not work with live view, but 12.3 does. Not sure if the issue was connected, but I did see a small "improvement" with my build machine. Will keep on with the print statements.

Thanks for the guidance on this. I've gone through the steps you've mentioned, deleting any items I found in my existing (broken) user account that I saw created in the new account (please note that I did not delete some items, as they were related to TextEdit, or other apps). However, this did not solve the issue.

I too am experiencing this issue (Cannot create Swift scratch context (couldn't create a ClangImporter)). I did create a new user, and saw success in getting debugging to work properly. However, I'm unsure of what actually is different between the two user accounts. Making a permanent switch to another user account would be too difficult at this point, as well. I've tried uninstalling Xcode, and clearing out/deleting all Xcode related folders I can find on the broken user account. Also, Xcode 11 continues to work perfectly. This only occurs on any version of Xcode 12 (all betas have had this problem for me)