1.3.1_20 errorneously copy plugin dlls to <FF_home>/plugins/. This causes FF to not being able to recognize any other version of JRE installed on the system (1.5, 1.6, 1.7, etc.).
Copy plugin dlls to <browser_home>/plugins/ is only necessary for Mozilla and Netscape. However, this step is a SHOULD NOT BE DONE for Firefox.
If there's any other update for 1.3.1 line, please make sure that 1.3.1 installer will no longer do this file copy for Firefox.

A bug 6592260 has already been filed to make sure that during installation, 1.5, 1.6, 1.7 removes these files if they happen to exist under <FF_home>/plugins/.