Applet loading behavior is not consistent as far as JRE download mechanism is concerned.
In case requested JRE e.g. 1.5.0_10 is not present on the machine ,at any point of time if JRE download process is cancelled then applet should get loaded using 1.6.0_10
But this is not always true, it has been noticed if user rejects the initial security warning d then applet get loaded using 1.6.0_10.
But if one accepts the security warning and later on rejects the security warning coming from JRE downloader then applet fails to load with any of the JRE

Steps to reproduce:
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1) Install 6u10 and make sure that no JRE from 1.5.0 family is installed on the machine
2)try loading the following applet http://nicole1.sfbay.sun.com:8080/plugin_tests/JNLPSupport/MultiJRE/manual/JRE1.5.0_10Test.html
3) There should be "Java Security warning", telling users about the insecure and not latest version under 1.5.0 family, should be there
4) Click "Cacnel" and applet should get loaded using 1.6.0_10
5) Reload page and security warning mentioned in #3 is going to be there again
This time instead of "Cancel" click on the "Download" button
6) "Java(TM) Platform SE Binary - Security Warning" pop-up should be there
Click "Don't Run" and this time you can notice that unlike in #4 applet will fail to load