In-Place Editing of external DWG references means that you don't have to open an xref in a separate instance in order to modify it. This is helpful when the changes you need to make depend on geometry in the host drawing.
You can find In-Place Editing in several places in LT 2010:
- At the command line (REFEDIT)
- On the expanded portion of the Reference panel of the Insert tab
- On the External Reference contextual ribbon tab (after the reference is selected)
- In the right-click menu (after the reference is selected)
When you start it, you get a dialog asking what, exactly, you want to edit.
The top level in the tree represents the whole drawing, while each item in the list below is an individual block definition. You'll likely want to choose the whole drawing, since the Block Editor is usually better for editing blocks. (Obviously there are exceptions, though!)
Those block definitions are considered "nested objects" -- you can either include them in your editing session automatically, or choose them individually. It's basically the same as choosing the whole drawing or selecting items in the list above.
Once you press OK, you're in the Reference Editing environment, helpfully identified with a contextual ribbon panel.
While you're here, you can do anything you would in an ordinary drawing: create, modify, or delete content as much as you like.
The two tools at the end of the tab, though, are unique to In-Place editing.
"Add to Working Set" is used to transfer content from the host drawing to the referenced file. "Remove from Working Set" goes the other way, transferring objects from the referenced file to the host drawing. Use these with caution, or you'll have objects end up in unexpected places.
When you save your changes, the original file is actually modified. All files referencing the changed file will show the updates next time they're opened. Chances are this is what you wanted anyway, but it is good to keep in mind.