Eclipse can barely update from 3.7.1 to 3.7.2, never mind from 3.7 to 4.2.
You’re taking the life of your development environment in your hands if you try to make that much of an upgrade to an existing Eclipse development environment. I don’t know about you, but my development environment is too important to risk upgrading.
Always create a new Eclipse directory and new Eclipse workspaces when you want to change your development environment.
Unzip Eclipse 4.2 to a new directory, and add your plug-ins one at a time. You can use Bananeweizen’s method to copy the Eclipse 3.7 plug-ins, or you can add them manually. It’s probably a good idea to see if the plug-ins you use have been upgraded for Eclipse 4.2.
Create a new Eclipse 4.2 workspace, and copy your project code from your Eclipse 3.7 workspace. If you discover a problem later, you can fall back to Eclipse 3.7 and your Eclipse 3.7 workspaces.
When you have an Eclipse 4.2 environment that works, zip it back up and keep the zip file so you can restore your Eclipse 4.2 environment in the event your Eclipse gets corrupted.
Never ever think of changing your working environment.