It's been a while so I don't have all the URL references anymore, but I have:
Eclipse build 20090619-0625
Lua Development Tool 184.108.40.206710012327 (Kepler?)
and the underlying JVM to run Eclipse. For the components I just used a lot of Google searches to find them all (I'm on a Mac)
Again, it's probably overkill for most.
Since most of the Luup stuff is really XML files, the Syntax editing and other stuff really isn't going to work correctly. I use the Eclipse setup mostly for the Project/Package mgmt, a basic XML-aware editor (etc).
The one gotcha here is that, because we're working in XML, you have to remember to "XML Escape" your Lua code (change "&" to "&", "<" to "<" etc, etc). This will take a while to remember, and several "broken" uploads)
If you're writing a pure-Lua program, the Eclipse editor has a console (etc) so you can see output.
I also moved to here because AnscaMobile has a Lua platform for writing iPhone applications, so I figured I needed an env to do it all (just haven't gotten to the latter just yet)