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If you attempt to have your wokspace on a network drive eclipse just complains that the workspace is busy. Can only creat the workspace on local hard drives. Prevents use in a networked environment.
The problem comes from java which on some file systems prevent locking, consequently causing the error you see. As a workaround I would run with the following vm arg: -Dosgi.locking=none
See related bug 44735.
*** This bug has been marked as a duplicate of bug 44735 ***