As a matter of fact extensions loading (Extension-Name: http:...) worked with XP but as Vista was released, security issues were stated and VIsta added filepermissions which changed accessibility of lib/ext folders.
I think I read an official statement from Sun regarding the recent release of version 14 for Java 6 a month ago. It basically confirmed the transition from applets to JNLP, yet in my opinion, I think that the applet technology may flow more into cell phones.
JNLP is now replacing the standard applet mechanism, although installing over Vista is permitted only in the user.home folder.
The same behavior relates to my Ubuntu Linux install. I believe that an optional update from Microsoft can cause Windows XP to act accordingly, and if not, I may have read too much on FUSE as a file system replacement for both Linux and Windows.
I think about if a privileged access is required to get in full-screen..
From what I understand, it can work on existing environments as long as files remain signed for either applets or JNLP. I imagine that a script can be setup so that on a computer's boot time, the necessary files would become signed automatically through Ant or whatever. (I forget if that requires a password. If so, bad idea on my part.)
I tried the SF3JSwing in both Linux and Windows XP. The "Vista" version seemed to load fine in Firefox in XP. The Linux version downloaded the natives and dependencies into my home folder, but it refused to start. It didn't seem to embed correctly into Firefox 3.0 for some reason in Linux. Otherwise, it appeared to retrieve all the files correctly.