The Large Observatory For X-ray Timing (LOFT), selected by ESA as one of the four Cosmic Vision M3 candidate missions to undergo an assessment phase, will revolutionize the study of compact objects in our galaxy and of the brightest supermassive black holes in active galactic nuclei. The Large Area Detector (LAD), carrying an unprecedented effective area of 10 m^2, is complemented by a coded-mask Wide Field Monitor, in charge of monitoring a large fraction of the sky potentially accessible to the LAD, to provide the history and context for the sources observed by LAD and to trigger its observations on their most interesting and extreme states. In this paper we present detailed simulations of the imaging capabilities of the Silicon Drift Detectors developed for the LOFT Wide Field Monitor detection plane. The simulations explore a large parameter space for both the detector design and the environmental conditions, allowing us to optimize the detector characteristics and demonstrating the X-ray imaging performance of the large-area SDDs in the 2-50 keV energy band.