Auto Update is on: "Check for Updates Automatically" is checked, jusched process starts after restarting the system
Usually JFB bundles have "fb" in their names, but 7u2 b20 bundles have not.
7u2 b20
/java/re/jdk/7u2/promoted/fcs/b20/jfb/bundles/windows-i586/jre-7u2-fcs-bin-b20-windows-i586-21_nov_2011.exe
7u1 b20(rev, not fcs)
/java/re/jdk/7u1/promoted/rev/b20/jfb/bundles/windows-i586/jrefb-7u1-rev-bin-b20-windows-i586-25_oct_2011.exe
Are you sure that JFB bundles were built?
There are NoRhino bundles in the same directory and they have this "fb":
jrefb_NoRhino-7u2-fcs-bin-b20-windows-i586-21_nov_2011.tar.gz