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In the past, architectures of augmented reality systems have been widely different and tailored to specific tasks. In this paper, we use the example of the SHEEP game to show how the structural flexibility of DWARF, our component-based distributed wearable augmented reality framework, facilitates a rapid prototyping and online development process for building, debugging and altering a complex, distributed, highly interactive AR system. The SHEEP system was designed to test and demonstrate the potential of tangible user interfaces which dynamically visualize, manipulate and control complex operations of many inter-dependent processes. SHEEP allows the users more freedom of action and forms of interaction and collaboration, following the tool metaphor that bundles software with hardware in units that are easily understandable to the user. We describe how we developed SHEEP, showing the combined evolution of framework and application, as well as the progress from rapid prototype to final demonstration system. The dynamic aspects of DWARF facilitated testing and allowed us to rapidly evaluate new technologies. SHEEP has been shown successfully at various occasions. We describe our experiences with these demos.