I'm trying to understand the transition people make with their apps in the App Engine SDK and how/why/what they move to the Google Plugin for Eclipse. It seems you can create a web application using the App Engine SDK, or you can do the same with Eclipse. Why offer both? How do people transition App Engine into Eclipse and Google Web Toolkit?
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The Google Plugin for Eclipse DOES use and INCLUDE the App Engine SDK. You choose to use it if you prefer the convenience and features ECLIPSE gives you as an IDE.