Dynamips supports a limited number of Cisco routers: Cisco 1700, 2600, 3600, 3700, and 7200 routers to be precise. These routers were designed with generic off-the-shelf processors with well-known published specifications, so Christophe Fillot (the author of Dynamips) was able to write software to emulate these well-known functions well enough to interpret the instruction set from a Cisco IOS image for the precedingly mentioned routers and execute it.
Modern Cisco routers use proprietary ASICs to perform switching, so no one outside of Cisco knows what the functions are. Emulation of these devices is impossible without reverse engineering or otherwise obtaining Cisco's intellectual property.
So that's the way it is for Dynamips. It may not be the end of the story though for GNS3, because GNS3 supports other emulators as well. When Cisco start releasing more routers as Virtual Machines (like Vyatta does) it may be possible that these routers will be able to...