The Houdini Engine Documentation gives you information about Houdini's compact Engine API which extracts Houdini's core technologies into a procedural engine for film and game studios to integrate into other applications. With this documentation you can create a plug-in for any number of different DCC apps.What is the Houdini object-based API?
Houdini needs to be installed because the plug-in uses the Houdini Engine API, which is currently distributed together with Houdini. Since the Houdini Engine API could change between daily builds, the plug-in also needs to be compiled with a matching Houdini version.How does Houdini work with Unreal Engine?
The state of Houdini Engine can be viewed in Houdini while working with the plugin in Unreal, and changes on either end, whether in Unreal via the plugin or in Houdini via its various interfaces, will be synchronized across so that both applications will be able to make changes and see the same results.