There seems that some people is having troubles when uploading the .hex file to Arduino using eclipse.
My current environment is Arduino Mega (USB connected) + Win 7 + Eclipse + AVR Plugins for eclipse
Aftear reading through some posts here and trying different solutions, I finally got it to work.
It was easier than I thought: go to project settings and pick AVR > AVRDude > Programmer. Then click on edit.
Then type in your right COM port, choose Arduino as the programmer hardware, and pick 57600 on the Override default baudrate dropdown, at the bottom of the screen. Then hit OK and OK again to close all the dialogs.
Just FYI, I'm using WinAVR 20100110.
This might see obvious for some of you but I hope people who is having problems with eclipse find it useful.