If an employer establishes a revocable rabbi trust, may the employer (as the settlor) use the assets in that trust for other general purposes without revoking and terminating the trust? Or is there some applicable general trust law principle that prohibits settlors from using the funds of a trust without revoking the trust completely? For example, would the trust be seen as 'illusory'? Would there be any negative accounting effect?

(this is, of course, putting aside the practical question of why the employer would want to set up the trust if it may want to use the funds anyway.)

Thanks for any advice/input.

You can call a trust a "Rabbi Trust" if you wish, but it will only be a Rabbi Trust if the trustee takes certain actions upon change of control, filing for protection from creditors, etc.

There is no "applicable general trust law principle that prohibits settlors from using the funds of a trust without revoking the trust completely". The trust can be invaded by the settlor if the trust so provides. However, it will not be a Rabbi Trust any longer.