Eytan, a few things:
However, if I try to debug, I get an unable to connect to JVM prompt.
Are you manually trying to connect to the running app server? If you started Tomcat with MyEclipse’s toolbar button, then there is no need to, the debugger is automatically connected for you, so you can just start setting breakpoints without any problems.
I see that Tomcat 5.0x is required to debug.
Actually JSR-45 is required for full debugging, and Tomcat 5.0.x and greater supports that, so the version you are using now *might* give you flaky debugging with your servlets and other classes, but that is it. You won’t be able to debug your JSP pages with Tomcat 4.x
Is there a way to add Tomcat 5.0x to the exisitng 4.x configuration on Mac OS X Server for the debugging
All you need to do is download Tomcat 5.0.x and unzip it to a new location, go to your Window > Preferences > MyEcliupse > Application Servers > Tomcat 5 settings and point it at your new install of Tomcat, then you are done.