Can anyone explain how AEs work to me? I have been playing since about April and have never played any of them or played against any of them either. I was just wondering how the mechanic works? It may prompt me to break out one from the WoS set to give it a try.

Basically you could start with Peter Parker, then once the Alter Ego power shows up on the dial, you can switch with the corresponding figure described in the power on its Orange starting line. All feats, objects or other special effects that were attached to the other figure are now used by this figure as if it is one continuous dial. But you cannot heal past the Orange line and you cannot switch back to the other figure (unless a power would allow it).

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Well, note that the different AE powers are written slightly differently, so be sure to read them (in particular, the Hulk set AEs are a bit nicer than the WoS/BATB AEs), but I'll take a basic one.

Alter Ego: Superman: Give Clark Kent a power action and replace this character with a #017 Superman on its orange starting line. Existing action tokens from this character, as well as action tokens and pushing damage for this action are applied to the replacement Superman. If replaced, no victory points are awarded for this character and the replacement Superman is considered to be 48 points for all game effects.

So, if you have Clark Kent on the board, and his alter-ego power is showing (it's a special power so it has to be on the dial), you can give him an action and replace him with the Superman figure specified on his orange starting line. It's pretty straightforward, until you get to the parts where it isn't. Thankfully, most of the complicated bits don't come up that often. Here are the questions everyone asks:

No, you can't play Superman on his orange starting line for the lower cost. Would be nice, sometimes.

Once Superman is on the board via AE power, you cannot heal him back above his orange starting line for any reason.

Yes, if you give Clark Kent an action while he has a token already, he will take pushing damage after he transforms into Superman.

Superman and Clark Kent are considered the same dial/figure/whatever for most purposes (healing being the only exception I can think of). If you put a feat on Clark Kent, Superman will have the feat. If Clark gets the Gem of Cytorrak, Superman will have the Gem. If a power is Outwitted on Clark, it would be Outwitted on Superman. This even applies to complicated situations, like giving Brilliant Tactician to Bruce Wayne. Bruce has Perplex and his Batman form has Outwit, allowing Bruce to qualify for using Brilliant Tactician.

Keywords can get complicated. Theme team is checked only at the beginning of the game, so if the AE of a figure doesn't have the same keywords, it won't cause your team to cease being a theme team half-way through the game, however, it will find itself no longer being subject to the theme team rules itself. Say you're using Norman Osborne on a Politician theme team, and AE him to Iron Patriot who does not have the keyword. The team will still be a theme team, but Iron Patriot will no longer be able to take a token to use Theme Team PC as he no longer has the keyword. (His teammates can still use TTPC on his behalf, of course.)

This gets REALLY complicated with ATAs. The Spider-Man AE figure has Outlaws, but his associated Peter Parker does not. If you want to use the Outlaws ATA on a team with Peter Parker, you have to choices. If you pay for the ATA as if Peter Parker had Outlaws, then Spider-Man will benefit from the ATA after he transforms. If you do NOT pay for him to have the ATA, then Peter Parker cannot AE to Spider-Man at all because doing so would create an illegal rules situation (the AE would not be applied to every figure with the appropriate keywords).

By now, several other people have responded to this thread. It will be fun seeing what I forgot to mention! : - )

Edit: Only one other person posted before me? I'm disappointed. : - )

Thanks guys