Dears..
I have found a workaround for running the old Java Initiator (1.2 , 1.3) on windows 7 and here is the way to do it. (please note that when the Java applet will run, it will turn off window Aero and some time may cause some flicking in the gadgets)
1. You need to download in install Java Runtime v. 1.4 (I’ve try to run it on version 1.6 u16 but it didn’t work)
2. Install the Java Initiator you need to use with internet explorer
3. Now brows to (C:\Program Files\Java\j2re1.4.2_11\bin\client) (where C is your default OS partition)
4. Copy the file JVM.dll
5. Paste the above file in the following folder after renaming the existent one (C:\Program Files\Oracle\JInitiator 1.3.1.23\bin\hotspot)
6. That’s it. Now go and run the desired application.