Some notes from my installation experience:

Setting up the SDK:

• Set your System Variables Path to '\tools' directory within the SDK folder.
(MyComputer-Properties-Advanced-Environment)

Setting up ADT:

• Start Eclipse.exe
• From Eclipse add the ADT installation folder as a software update.
(Help-SoftwareUpdates-Available-Add Location / Tick all options - Install

Using the Emulator for the first time (while in a project within Eclipse)

• First you must create a AVD (Android Virtual Device)
• To see your available targets execute (from Windows Command Prompt in your '\tools' directory)
  
android list targets

• To create your AVD execute
android create avd --target --name

• Start Emulator and execute
emulator -avd