Tested build: jdk7 b126-pit http://rehudson.sfbay.sun.com/hudsonws/deploypit/bundles
Tested OS: solaris10 sparc, winxp x86.
Tested browser: firefox 3.5

Steps to reproduce:
1) Open the following url with java console open
http://sqeweb.sfbay.sun.com/jsn/users/fred/reproduce/appletparam/testJnlp.html
2) Check the output in java console. If the max heap size is over 60m, bug is reproduced. like this: @@@@ max memory is 257490944bytes

Souce code location:
http://sqeweb.sfbay.sun.com/jsn/users/fred/reproduce/appletparam