SimWalk2 can handle letter alleles.
If I take the example ‘bed.*’ files from the ‘example’ directory of the Mega2 distribution,
and change the bim file to look like this:
$ cat bed.bim
5 M1 0 1 A T
5 M3 5 2 G C
5 M2 8 3 C G
and then convert to SimWalk2 format using Mega2 v4.8.0, the resulting files contain letter alleles
$ head sw2_pedigree.05
(I5,1x,A3)
(3A4,1X,2A1,(T16,3(A8),:))
11 1
1 M A/ T G/ C
C/ C
2 F A/ T C/ C
G/ G
3 M T/ T G/ C
C/ G
4 1 2 F A/ T G/ C
and run just fine though SimWalk2.
So we are not able to reproduce your problem in our hands?