I saw this today by chance and thought it was worth a mention for anyone experiencing similar problems:
http://forums.java.net/jive/thread.jspa?threadID=63377&tstart=15
[quote]There’s a Microsoft bug (reportedly addressed in Windows 7, but I haven’t had
a chance to verify it yet) which forced Java2D to disable onscreen hw
accelerated rendering in applets on Vista. The offscreen rendering is still
accelerated (when you render to the VI), but it is then copied to the screen
(browser page) using GDI.
[/quote]