The lit-plugin in for VS Code offers syntax highlighting, jumpt-to-definition, etc:
https://marketplace.visualstudio.com/items?itemName=runem.li...Prettier already supports HTML in html`` strings, likewise, CSS.
> Is there a way in Lit to write the templates in regular HTML rather than a string?
This would require a compiler. You would need to load the HTML into the JS module graph and JS can't do that yet, though there is a proposal for it: https://github.com/WICG/webcomponents/blob/gh-pages/proposal...
Template in HTML also have the problem of the data not being in scope as it is in JS, and there not being an expression language. So you ned up having to re-implement a lot of JS embedded into the HTML syntax, which then preferences a compiler-based approach to make fast. It turns out to be a lot simpler to embed HTML in JS.