Hey Eric,
I verified that I have the KSDK 1.2.0 Eclipse Update installed (it's the same version as shown in your screenshot).
I don't see a file attached to your post. I know Freescale has been having lots of difficulty with spam recently. Maybe their server stripped it as potentially dangerous content?
I was going to attach my file with the extension renamed; but, I don't even see an option to do that! I know I've done it in the past.
So, here's the first few lines of my file. . .
<?xml version="1.0" encoding="UTF-8"?>
<ksdk:manifest format_version="1.2" xmlns:ksdk="http://freescale.com/ksdk/1.2/ksdk_manifest.xsd" xmlns:xsi="http://www.w3.org/2001/XMLSchema-instance" xsi:schemaLocation="http://freescale.com/ksdk/1.2/ksdk_manifest.xsd http://freescale.com/ksdk/1.2/ksdk_manifest.xsd">
<!--This file is designed to identify Kinetis SDK release. It was generated by Doxy2Component.-->
<ksdk id="KSDK120" name="KSDK 1.2.0" version="1.2.0"/>
<api version="1.2.0"/>
<compilers>
<compiler name="arm"/>
<compiler name="gcc"/>
<compiler name="iar"/>
</compilers>
<toolchains>
. . .and I do see the "</ksdk:manifest>" closing tag at the end. So the file looks like it's intact. I don't know that all of the content is valid, but at least the file isn't corrupt.
I'd rather not uninstall/reinstall. My system is running, it's just a minor inconvenience while creating a new project. . .
Unless, of course, this could mean that there are other problems I am unaware of?