Java not respecting system proxy settings.

Trying to launch a webex session in Safari (Version 5.1.2 (6534.52.7)) from behind a corporate VPN, but is failing with

Using JRE version 1.6.0_29-b11-402-10M3527 Java HotSpot(TM) 64-Bit Server VM

[…]

load: class JVMDetect not found.

java.lang.ClassNotFoundException: JVMDetect

at sun.plugin2.applet.Applet2ClassLoader.findClass(Applet2ClassLoader.java:252)

at sun.plugin2.applet.Plugin2ClassLoader.loadClass0(Plugin2ClassLoader.java:249)

at sun.plugin2.applet.Plugin2ClassLoader.loadClass(Plugin2ClassLoader.java:179)

at sun.plugin2.applet.Plugin2ClassLoader.loadClass(Plugin2ClassLoader.java:160)

at java.lang.ClassLoader.loadClass(ClassLoader.java:247)

at sun.plugin2.applet.Plugin2ClassLoader.loadCode(Plugin2ClassLoader.java:690)

at sun.plugin2.applet.Plugin2Manager.createApplet(Plugin2Manager.java:3045)

at sun.plugin2.applet.Plugin2Manager$AppletExecutionRunnable.run(Plugin2Manager.ja va:1497)

at java.lang.Thread.run(Thread.java:680)

Exception: java.lang.ClassNotFoundException: JVMDetect

Trace level set to 5: all… completed.

Logging set to : true… completed.

network: Connecting http://oraclesystemsupport.webex.com/sc0700ld/supportcenter/html/applet/JVMDetec t.class with proxy=DIRECT

network: Connecting http://oraclesystemsupport.webex.com:80/ with proxy=DIRECT

It seems it can't load the class because it's trying to connect DIRECT and not via my corporate proxy.

My proxy is configured in my system settings as "auto proxy discovery". Everything else honours the proxy setting. Safari has no problem and connects to all internal & external sites without issue. Even Firefox has no problem, and can launch the webex fine. If I configure a proxy ipaddress in the "Java Preferences" network proxy settings, I can launch the webex. But when set to "use system settings", it doesn't use the proxy.

So I can't figure out why java, when launched through safari, doesn't respect the system proxy setting.

I know it's nothing to do with local caching because I get the same with a fresh user I created especially for testing.

Has Apple broken something? It was working fine until I applied the latest updates last week.