Kepler is not supported.
You should not have installed Avr eclipse plugin. It is confusing and you need to configure both to get it to work.
You probably used the avr upload button when uploading. The other button could have worked. You can read more on he relation between the 2 here http://www.eclipse.baeyens.it/Arduino%20eclipse%20plugin%20FAQ.html#WINAVR
Today I should advice to install Juno CDT and V2 of the plugin. This version has a Arduino menu and uses the Arduino buttons. It doesn't include winavr nor depends on it.
Well now I have installed
Eclipse Juno Service Release 2 (126.96.36.19930211-1820)
Arduino eclipse extensions (188.8.131.52)
After restarting Eclipse I got the following message
'Discover compiler built in language settings' has encountered a problem.
Problem running CDT scanner Discovery provider it.baeyens.arduino.languageSettingsprovider
I can't upload any sketch. I see that under Windows/Preferences I only see one item for Arduino and none for paths or avrdude as in the installation instructions. What have I missed now ?
Not sure which installation instructions you are referring to. There is nothing on arv dude in my instructions http://www.eclipse.baeyens.it/Install.html
There shoiuld only be Arduino in the preferences.
Version 2 needs Arduino IDE 1.5.2 beta (all other versions will not work)