What I have found works best is this process:
1) make code changes (directly in stemapp/widgets/mywidget)
2) delete widget in app, save.
3) F5 refresh browser
4) Re-add widget.
On annoyance I've had, when pulling a widget from source control into stemapp, if I don't first shut down the server, that widget gets added to the widget picker a bunch of times, and seems to stay that way. To remove the extras, I've done a full wab install replacement. There's got to be a much better way, I presume?