Update: 8/16/2014,SamV, I am recoding this for any other developers going through such upgrades in the future.
We did complete our PB 12.5 upgrade project. What a journey? There were lot of technical challenges, but some were purely administrative.
On the technical front, this got more complicated because our OS changed to Windows 7x64 and the Server side had to be upgraded from Windows 2000(!) to Windows 2008 to accommodate PB 12.5 Runtime.
On the non-technical front we had other challenges. To start with, we did not know if we had free upgrade available to us for all the annual contracts we paid. It took us a while to found out, we did. Sybase (SAP) changing their licensing model to SySAM and Windows making it harder to get VMs (we ended up getting Datacenter licenses) only made it more challenging. We needed some guidance (this forum was helpful), some tweaks, some luck and of course lots of long nights!
Our original setup was PB 10.2 working on XP with PVCS 8.02, Powergen 6.5 (for build master), Oracle 10g, EAServer (EAS) 5.5, and the Deployed EAServers were running on Windows 2000 VMs. Our code base is built over EA Framework 4.0.
We did not upgrade EAS 5.5, but ended up replacing the JVM to 1.5.0_22 (otherwise times printed in GMT). This JVM version was not recommended (last supported version was 1.5.0_09), but decided to try it anyway. For most part it's been working OK. (Few issues I am still tracking). I did try EAS 6.x, that proved to be a disaster for us.
We had to upgrade Powergen to 8.5 (we had 6.5), stayed with PVCS 8.02 (but had to replace the JVM inside it), we kept Oracle 10g client as EAS 5.5 wouldn't work with 11g client. We finally settled for Oracle 10.2.3 client (unfortunately the latest instant client 11.2.5 did not work on the Windows 2008 server for some reason).
Remote debugging works inside PBVM 12.5. (In one case I had to tweak the components/package/IDL files to make the PB Debugger come up).
I had a question in this post, about couple of errors that show up during deploying components from PB 12.5 to EAS 5.5. That turned out to be harmless, at Patricia answered earlier.
Overall, there were only a handful of PB errors (one serious issues with Yeld - I will post this separately). I had to tweak some of the project workspaces and targets to make them work in PB 12.5.
Most of the work we did was in other software (in getting them to work with PB), etup and infrastructure issues. Of course, Sybase's own SySAM policy made it more challenging, luckily we didn't have to do it for EAS 5.5 or Runtime.
Thank you all that answered my questions. They were really helpful in making some of the hard decisions we had to make during this project (EAS 5.5 for one).