How do I make a Java library with Eclipse?
You must not create any library, if you use the same workspace.
Option 1: Just use the source
In the properties of the project which has the dependencies you can add another source-folder:
Properties > Java Build Path > Tab: Source > Add Folder...
In the Project Tab you can "add" the whole project to the other project, too. There are many ways to achieve your goal.
Option 2: Create and add the library to the Build-Path
Adding an existing Jar (your own library):
If it is in the workspace:
Properties > Java Build Path > Tab: Libraries > Add JARs...
If it is somewhere on the drive:
Properties > Java Build Path > Tab: Libraries > Add External JARs...
Exporting a source folder as a library:
Context Menu of Source Folder > Export > Jar File
There are two types: Executable Jars and "normal" Jars. You don't need an executable Jar.