A BE76 Instructor; unable to unfeather a propeller after an engine failure simulation; landed without declaring an emergency even though the student pilot entered 7700 in the transponder.

Narrative

While en-route I was conducting a Multi Engine Instructor training flight with a student/ single engine instructor. While en-route; I simulated the failure of the left engine of the aircraft. Upon simulating the failure of the student feathered and secured the left engine. Upon completing the failed engine task; we began the in air restart checklist. Upon completing the restart checklist; the left propeller failed to un-feather. I believe the un-feathering accumulators failed to supply adequate pressure to un-feather the prop. I began the re-start without accumulators checklist; and attempted to start the engine by using the magnetos. The engine failed to start after three attempts trying this method. During the restart procedure; I performed a 100 KT descent at least 3 times in an attempt to windmill the engine. Due to these descents; I was now around 2;500 FT MSL. Due to the low altitude and the failure to restart the engine; I asked for landing clearance at our destination airport. Tower Controllers assigned me a straight in approach to Runway 18. I was set up on a 6 mile straight in final for 18 at the time of the call to the Tower. I landed; and taxied the aircraft to parking without incident. Upon returning to the flight school; we were able to get the engine to restart and the prop to un-feather. No emergency was declared in statements with the Control Tower; however; after landing I saw 7700 on the face of the transponder. I believe my student mistakenly 'squawked' 7700 while I was telling Tower about our situation.