Answer: Hornworms are the larvae of the Sphinx moth so the adults fly into the garden and lay eggs. The eggs hatch into caterpillars and they feed on the leaves of tomato, pepper and other plants. You can pick off the caterpillars and destroy them or you can use the botanical Bt (bacillus thuringensis, sold as Dipel). It's a stomach poison so the caterpillars need to consume it which means it won't kill on contact.
Frass is simply bug poop. It is the digested remains of the leaves the caterpillars have consumed. I guess you could consider it a form of natural fertilizer and it does not need to be removed from the garden.
Don't pull your plants out, but do get rid of the hornworms before they completely destroy your plants.
Best wishes with your new veggie garden!
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