The 3D Flash stuff is software rendered. The new update N stuff for Java should see some actual competition against Flash, but only if developers can provide noticeably cooler applets. I can fairly easily turn Titan Attacks and Ultratron and Treasure Tomb into actual web page applets - might be fun.
As for “real 3D” games - same setup code applies. We’ve tried to hide most of the nonsense in LWJGL but it’d be nicer to have it simpler still with a lightweight framework. Slick springs to mind 
Cas 