[SalesForce] Unable to refresh src from server using force.com IDE

Are you getting some kind of error? Does it just hang indefinitely? Hard to say without more details so just check these hints in no particular order:

1. There's a limit of max 5,000 items obtained in one retrieve / deploy session. If you suspect there are tons of reports in one of folders you're refreshing you'll have to somehow split it up. You can check the count of items in each folder with a query, for example

   SELECT Count(Id), OwnerId
   FROM Report
   GROUP BY ROLLUP(OwnerId)
   

   (there will be 3 types of Ids - your own User Id to indicate "my personal custom reports", real folders' Ids and the Organization id to mark "unfiled public reports")

2. Eclipse is known to throw weird errors, for example Unable to refresh src from server using force.com IDE For me it happens after I create new project (it's created OK but can't retrieve any files). I need to close it, open up (sometimes with "run as administrator") and then it works OK... but this might be a "cargo cult" and indeed tips like swith workspace might be the simple solutions.

3. If it hangs on "Add/Remove Metadata components" you might decide to edit your package.xml by hand (it's not rocket science), maybe even create subfolders of the "reports" directory and refresh only them by right-clicking directly instead of on whole "src". Sample section might look like that

   <types>
       <members>Operations_Reports</members>
       <members>Operations_Reports/Order_Count</members>
       <members>Operations_Reports/Commitment_Pie_Chart</members>
       <members>IT_Reports</members>
       <members>IT_Reports/Open_IT_Cases</members>
       <name>Report</name>
   </types>
   

4. If you're retrieving data and Eclipse seems to be hanging - does the [workspace]/.metadata/.log file contain anything useful? If you're deploying - monitor deployments in the Setup?

5. Running Eclipse with more memory? Disabling plugins / features you don't use at the moment (Maven tasks for example). Suppress antivirus for a while?
6. Maybe you're doing it wrong ;) Examine the Report table, especially LastRunDate column... you should be safe notifying users that you'll delete anything that was not touched in 1+ year (well, check if anybody has some reports he accesses only near the year's end ;)), wait a bit and delete right away without moving them around? This table does not support delete operations so you'd be either looking at destructive deployment, tons of manual clicking or a cheat like accessing https://eu1.salesforce.com/{reportId}?delrep=1

Mark Pond is correct that you need to be running java 6 but you do not need to remove java 7 from your machine. Just download the java 6 JRE and add a line to the ini file to manually set your java VM. This way it won't get messed up again if you ever switch java versions on your machine.

Instructions on how to add -vm argument are here.