But Some "EPROM Emulators" do take it further and force you to use external code memory, which, in my opinion is a thing of the past.

But a faulty ICE is just as useless as a faulty EPROM Emulator!
I think I have solved more 'insolvable' cases by not believing the tools, than using them. I have seen problems when a defective tool 'lied'. I have seen problems where believing too much in a functioning tool was the problem. I remember one where I reasoned that a (~2-5ns) pulse that you could not see on the scope had to be there. After much arguing with the customer, my remedy was implemented and - lo and behold - the thing worked.

HOWEVER, the tools are invaluable for 'solvable' cases which, after all, is 99%+ of what we see.

Erik