This isn't an issue with Xcode, thats what its supposed to do.
You can certainly duplicate your entire project for the iPad version manually if you'd like, but I can't think of a case where you'd actually want to do this.
Most of the time you just want to change the View layer between the iPad and iPhone version. You can load a different Nib based on the device you'd like or even load completely different view controllers doing simple logic like
if ([[UIDevice currentDevice] userInterfaceIdiom] == UIUserInterfaceIdiomPad) {
viewController = [[MyViewController alloc] initWithNibName:@"ipadNIB" bundle:nil];
} else {
viewController = [[MyViewController alloc] initWithNibName:@"iphoneNIB" bundle:nil];
}
** BEGIN EDIT **
To setup a different storyboard for iPhone/iPad all you need to do is create another storyboard and name it "myprojectname_ipad.storyboard" then in the Info.plist for your project add a key called "Main storyboard file base name (iPad)" with a value "myprojectname_ipad"
** END EDIT **