As far as I know the Eclipse Che GWT client is replaced by Eclipe Theia in the upcoming version 7 which is currently in beta. But I think both will still be independent projects.
Yes, it is an independent project used by different products like Gitpod (www.gitpod.io), Google Cloud Shell, ARM Mbed Studio (https://os.mbed.com/studio/) and so on. Eclipse Che is going to replace own GWT based IDE with Theia in version 7 as you mentioned.
Theia is an IDE framework implemented with cloud first mindset, not a code patch to make VS Code to run in cloud. It does reuse important VS Code components, like Monaco editor, language-server and debug adapter protocols, and VS Code extensions, but relies only on stable and documented APIs for it.
Also:
- In addition to support of VS Code extensions, it has more flexible extension model to allow building white-labeled products like Gitpod (www.gitpod.io) or ARM Mbed Studio (https://os.mbed.com/studio/)
- It's open-source governed (Eclipse Foundation), i.e. no dependencies to Microsoft, all contributions are verified on license compatibility with Apache 2.0 and so on.
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At first glance they do look similar.
Also:
- In addition to support of VS Code extensions, it has more flexible extension model to allow building white-labeled products like Gitpod (www.gitpod.io) or ARM Mbed Studio (https://os.mbed.com/studio/)
- It's open-source governed (Eclipse Foundation), i.e. no dependencies to Microsoft, all contributions are verified on license compatibility with Apache 2.0 and so on.