Upgrading from 1.7 seems fraught with peril.  The docs even suggest that you
install on a clean install of Eclipse, which is what I did because prior to
that, my own attempt resulted in much confusion.

As the gwt.xml, it appears that there was a bug (supposedly fixed for RC 2)
regarding uppercase characters in the gwt.xml file name.  I went with all
lowercase letters and it seemed happy.  I also found that I had to add
-Xms100m to my debug launch param for the JRE VM to avoid module load
failures.  Hope this helps....

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