JRE off-line installer sets incomplete info in RunOnce registry
in case user opts for installation to be completed after login/reboot:

[HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\RunOnce]
"JavaInstallRetry"="RUNONCE=1 SPONSORS=0"

As a result installation doesn't continue after login/reboot
so JRE upgrade gets rolled back.

On-line installer sets correct data which is:
[HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\RunOnce]
"JavaInstallRetry"="\"C:\\Documents and Settings\\User\\Application Data\\Sun\\Java\\JRERunOnce.exe\" RUNONCE=1 SPONSORS=0"

How to reproduce:
-Install JRE 7u4
-open IE
-Install with off-line installer JRE 7u6
-When "Close IE to continue installation" windows pops up
 click "LATER" button.
-click "OK" button to continue the installation after login/reboot
-if no JRE installation takes place after login/reboot then the bug
 is reproduced.