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Plugin.xml editor folding is available in Eclipse 3.3, and we had this prototype way back using a custom XML editor.
Hey, Chris, would you be interested to contribute this to Mylar? You probably one of the developers of those pde editors anyways.
Chris: not sure if there is some background to Eugene's request for this, but note that I just prompted Christian to consider contributing his Spring-specific implementation of this (bug 111700 comment#4). I walked him though how to abstract our Java folding implementation, if you or anyone else is interested in doing this I can provide pointers.
Mylyn has been restructured, and our issue tracking has moved to GitHub [1]. We are closing ~14K Bugzilla issues to give the new team a fresh start. If you feel that this issue is still relevant, please create a new one on GitHub. [1] https://github.com/orgs/eclipse-mylyn