I am also unable to get Java Applets to run using the latest versions of Java 7 (update 13) and Mountain Lion (10.8.2). Is anybody out there able to use applets with this combination? Please. People are getting desparate here.
With regard to running Java from the command line, I can be of help. The listing below represent some key directories on my system. (I'm not quite sure how you are distinguishing terminal like commands from actually typing commands in the terminal window.)
The simplest way to get the java commands to work is to modify your PATH environmental variable (in .profile) so that the current Java binary directory (/Library/Java/JavaVirtualMachines/jdk1.7.0_13.jdk/Contents/Home/bin) comes before /usr/bin
The which command is very useful here
which java
will tell you what directory it is using for the java command
With regard to Java 6, my understanding is that Apple has disabled applet support in Java 6.
The java commands in /usr/bin have to be changed because Oracle is using a different directory structure than Apple did. What was Commands in the apple version is Contents/Home/bin in the Oracle version.
You should also change the symbolic links in /System/Library/Frameworks/JavaVM.framework/Versions
Apple placed the JVM's in /System/Library/Java/JavaVirtualMachines while Oracle puts them in /Library/Java/JavaVirtualMachines
The Applet plugin is in /Library/Internet Plug-Ins
BradleyRossMacBook:~ bradleyross$ ls -l /usr/bin/ja*
lrwxr-xr-x 1 root wheel 73 Oct 19 12:43 /usr/bin/jar -> /System/Library/Frameworks/JavaVM.framework/Versions/Current/Commands/jar
lrwxr-xr-x 1 root wheel 79 Oct 19 12:43 /usr/bin/jarsigner -> /System/Library/Frameworks/JavaVM.framework/Versions/Current/Commands/jarsigner
lrwxr-xr-x 1 root wheel 83 Feb 10 13:21 /usr/bin/java -> /System/Library/Frameworks/JavaVM.framework/Versions/Current/Contents/Home/bin/ java
lrwxr-xr-x 1 root wheel 84 Feb 10 13:23 /usr/bin/javac -> /System/Library/Frameworks/JavaVM.framework/Versions/Current/Contents/Home/bin/ javac
lrwxr-xr-x 1 root wheel 86 Feb 10 13:26 /usr/bin/javadoc -> /System/Library/Frameworks/JavaVM.framework/Versions/Current/Contents/Home/bin/ javadoc
lrwxr-xr-x 1 root wheel 84 Feb 10 13:26 /usr/bin/javah -> /System/Library/Frameworks/JavaVM.framework/Versions/Current/Contents/Home/bin/ javah
lrwxr-xr-x 1 root wheel 75 Oct 19 12:43 /usr/bin/javap -> /System/Library/Frameworks/JavaVM.framework/Versions/Current/Commands/javap
lrwxr-xr-x 1 root wheel 76 Oct 19 12:43 /usr/bin/javaws -> /System/Library/Frameworks/JavaVM.framework/Versions/Current/Commands/javaws
BradleyRossMacBook:~ bradleyross$ ls -l /System/Library/Frameworks/JavaVM.framework/Versions
total 80
lrwxr-xr-x 1 root wheel 10 Oct 19 12:43 1.4 -> CurrentJDK
lrwxr-xr-x 1 root wheel 10 Oct 19 12:43 1.4.2 -> CurrentJDK
lrwxr-xr-x 1 root wheel 10 Oct 19 12:43 1.5 -> CurrentJDK
lrwxr-xr-x 1 root wheel 10 Oct 19 12:43 1.5.0 -> CurrentJDK
lrwxr-xr-x 1 root wheel 10 Oct 19 12:43 1.6 -> CurrentJDK
lrwxr-xr-x 1 root wheel 10 Oct 19 12:43 1.6.0 -> CurrentJDK
lrwxr-xr-x 1 root wheel 58 Nov 27 18:23 1.7 -> /Library/Java/JavaVirtualMachines/jdk1.7.0_09.jdk/Contents
drwxr-xr-x 10 root wheel 340 Feb 8 14:48 A
lrwxr-xr-x 1 root wheel 59 Nov 27 18:18 Apple -> /System/Library/Java/JavaVirtualMachines/1.6.0.jdk/Contents
lrwxr-xr-x 1 root wheel 49 Feb 10 13:30 Current -> /Library/Java/JavaVirtualMachines/jdk1.7.0_13.jdk
lrwxr-xr-x 1 root wheel 49 Feb 10 13:30 CurrentJDK -> /Library/Java/JavaVirtualMachines/jdk1.7.0_13.jdk
BradleyRossMacBook:~ bradleyross$ ls -l /Library/Internet\ Plug-Ins/Jav*
/Library/Internet Plug-Ins/JavaAppletPlugin (1.7.10.18).plugin:
total 0
drwxr-xr-x 10 root wheel 340 Jan 11 10:23 Contents
/Library/Internet Plug-Ins/JavaAppletPlugin.plugin:
total 0
drwxr-xr-x 10 root wheel 340 Feb 11 11:12 Contents
BradleyRossMacBook:~ bradleyross$
BradleyRossMacBook:~ bradleyross$ ls -l /Library/Java/JavaVirtualMachines
total 0
drwxr-xr-x 3 root wheel 102 Nov 16 10:04 jdk1.7.0_09.jdk
drwxr-xr-x 3 root wheel 102 Feb 8 15:59 jdk1.7.0_13.jdk
BradleyRossMacBook:~ bradleyross$
BradleyRossMacBook:~ bradleyross$ ls -l /Library/Java/JavaVirtualMachines/jdk1.7.0_13.jdk/Contents/Home/bin
total 6888
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 appletviewer
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 apt
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 extcheck
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 idlj
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jar
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jarsigner
-rwxrwxr-x 1 root wheel 89064 Jan 30 04:30 java
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 javac
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 javadoc
-rwxrwxr-x 1 root wheel 2050 Jan 14 22:42 javafxpackager
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 javah
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 javap
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jcmd
-rwxrwxr-x 1 root wheel 89136 Jan 30 04:30 jconsole
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jdb
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jhat
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jinfo
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jmap
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jps
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jrunscript
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jsadebugd
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jstack
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jstat
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 jstatd
-rwxrwxr-x 1 root wheel 2673 Jun 5 2012 jvisualvm
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 keytool
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 native2ascii
-rwxrwxr-x 1 root wheel 89136 Jan 30 04:30 orbd
-rwxrwxr-x 1 root wheel 89136 Jan 30 04:30 pack200
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 policytool
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 rmic
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 rmid
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 rmiregistry
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 schemagen
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 serialver
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 servertool
-rwxrwxr-x 1 root wheel 89136 Jan 30 04:30 tnameserv
-rwxrwxr-x 1 root wheel 93440 Jan 30 04:30 unpack200
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 wsgen
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 wsimport
-rwxrwxr-x 1 root wheel 89128 Jan 30 04:30 xjc
BradleyRossMacBook:~ bradleyross$