Bnd has its own launcher and `Eclipse Application’ and ‘OSGi Framework’ are the ones native to Eclipse.
Just for clarification: please note that you need to use the Bnd one to launch a Bnd(tools) application (including the test Eclipse instance).
Please also note that, due to some of the quirks of the way that Eclipse was designed internally, you generally can’t re-compile and re-deploy a bundle into the running test Eclipse instance as you can with other applications. If you make a change to your code while the test Eclipse is running, you will generally have to exit and restart the test Eclipse instance. There are a couple of exceptions to this (see More Facades: Streamlining Eclipse plugin dev with ExtensionFacade for more details).