Found the answer through a little trial and error. The project contained a directory with a space in the name. (Windows) When this was removed everything worked.
When I was trying to implement the Fibu sample from http://docs.jboss.org/jbosside/tutorial/build/en/html/index.html the same error appeared.
1.) Download the latest version from xdoclet
2.) Copy all .jar Files from the xdoclet_xxx/lib directory to %eclipse.home%/plugins/org.jboss.ide.eclipse.xdoclet.core_xxxx
I used JBoss 4.0.2, xDoclet 1.2.3, Eclipse 3.0.2 with JBossIDE 1.4.1e30 and J2RE1.4.2_08.