This is some information shown in the log file.

Missing character: There is no € in font ptmr7t!
Missing character: There is no ˜ in font ptmr7t!
Missing character: There is no â in font ptmr7t!
Missing character: There is no € in font ptmr7t!
Missing character: There is no ™ in font ptmr7t!
Package epstopdf Info: Source file: <./figure/iie1.eps>
(epstopdf) date: 2016-10-31 17:03:06
(epstopdf) size: 723372 bytes
(epstopdf) Output file: <./figure/iie1-eps-converted-to.pdf>
(epstopdf) Command: <repstopdf --outfile=./figure/iie1-eps-converte
d-to.pdf ./figure/iie1.eps>
(epstopdf) \includegraphics on input line 964.
runsystem(repstopdf --outfile=./figure/iie1-eps-converted-to.pdf ./figure/iie1.
eps)...executed safely (allowed).

Package epstopdf Info: Result file: <./figure/iie1-eps-converted-to.pdf>.

! Package pdftex.def Error: File `./figure/iie1-eps-converted-to.pdf' not found
.

See the pdftex.def package documentation for explanation.
Type H for immediate help.
...

l.964 ...cludegraphics[width=0.49\textwidth]{iie1}
}
Using draft setting for this image.
Try typing to proceed.
If that doesn't work, type X to quit.

LaTeX Font Info: Try loading font information for OT1+pcr on input line 964.

(c:/texlive/2016/texmf-dist/tex/latex/psnfss/ot1pcr.fd
File: ot1pcr.fd 2001/06/04 font definitions for OT1/pcr.
)
Overfull \hbox (0.84283pt too wide) in paragraph at lines 964--965

Other existing images with such file names as foo-eps-converted-to.pdf are just OK.

Can you try running repstopdf --outfile=./figure/iie1-eps-converted-to.pdf ./figure/iie1. eps directly from the directory containing your TeX file?

Do other eps images convert or does it just insert the pre-existing PDF? I'm asking because the most obvious cause of issues with epstopdf is that GhostScript isn't available on the PATH being used by LaTeXTools (in which case, you'd need to modify the texpath setting).

I ran the command you gave in git bash, the corresponding pdf file is generated correctly. Then what's the problem of automatically processing then?

And about the PATH, how should I do to include it in the PATH used by LaTeXTools? Not the Windows system variable PATH, right?

Thanks.

You can just ensure its in the Windows PATH system variable or you can use the texpath setting provided by LaTeXTools to add it just for LaTeXTools (if you use that setting, remember to include ;$PATH at the end so it includes the standard Windows PATH).

I've added D:\Program Files\gs\gs9.20 to Windows PATH, and change the texpath setting in LaTeXTools.sublime-setting in Package setting - User as below:

    "windows": {
        // Path used when invoking tex & friends; "" is fine for MiKTeX
        // For TeXlive 2011 (or other years) use
        // "texpath" : "C:\\texlive\\2011\\bin\\win32;$PATH",
        "texpath" : "C:\\texlive\\2016\bin\\win32;D:\\Program Files\\gs\\gs9.20;$PATH",
        // TeX distro: "miktex" or "texlive"
        "distro" : "texlive",
        // Command to invoke Sumatra. If blank, "SumatraPDF.exe" is used (it has to be on your PATH)
        "sumatra": "D:\\Program Files\\SumatraPDF\\SumatraPDF.exe",
        // Command to invoke Sublime Text. Used if the keep_focus toggle is true.
        // If blank, "subl.exe" or "sublime_text.exe" will be used.
        "sublime_executable": "D:\\Program Files\\Sublime Text 3\\sublime_text.exe",
        // how long (in seconds) to wait after the jump_to_pdf command completes
        // before switching focus back to Sublime Text. This may need to be
        // adjusted depending on your machine and configuration.
        "keep_focus_delay": 0.5
    },

But it still does not automatically convert eps to pdf, but have to manually do that job. Anything else I should check? Thanks.

I found a typo in my texpath, fix it from C:\\texlive\\2016\bin\\win32 to C:\\texlive\\2016\\bin\\win32. Problem gone.

My bad. But not sure why the compiling of text runs anyway when the path is not correct.

Thanks for helping.

Yes, that is strange. Glad you've got things sorted!

works for me! Thks!

works for me！Thks！Just to note, you need to install GhostScript first from https://www.ghostscript.com/releases/ , and then add gs path to the tex path. the package itself can't convert eps to pdf, it needs to use repstopdf or gs! hope this note can help someone who read this.