Hi
God it took me FOREVER!!!!
But I got there in the end 
Robert's walkthrough is correct. It was just version conflicts. When the AVR plugin installs correctly it's seamless, there's no mystery to it or jumping through hoops.
The current version of the AVR plugin doesn't seem to like the current version of Eclipse.
Try with Eclipse Galileo
As for configuration I found both Robert's walkthrough and the Arduino playground walkthrough helpful
http://www.arduino.cc/playground/Code/Eclipse
Cheers
Jim