meta-environment? That's basically what a VM is in the first place. As for the automatic download-install, linux package managers will already do that for you. Of course, not for web apps, but who wants a web app telling their computer to download and install a program???
So why not add another level of meta? Why should the user even have to go to the package manager? If the user has stumbled across an app for which she/he doesn't have the right VM+runtime, why do they have to do any more than wait for the download to happen?
OS X has a mechanism such that a program only sees the versions of system libraries that it needs. There's no reason why Java couldn't have one as well.
We programmers may not like a web app telling the computer to download and install a program. The average user would rather have the system do it for them -- just so long as they don't have to worry about anything they don't understand.
That's exactly what the package manager does. If you install a program that needs the JVM, it will automatically download and install it. Can you elaborate on what you mean by "another level of meta"?
You're talking about ordinary desktop applications. For that, a package manager like dpkg and apt-get will work just fine. I thought that the article was talking about applets, which aren't meant to be permanently installed on the local machine. However, they have a dependency on a Java runtime which is installed there. If the designers of Java were a little more forward thinking, they wouldn't have created this dependency. The desktop JRE would be managed by whatever mechanism on the machine, but the applet JRE would be managed separately. The entire thing could be managed by a program implemented in just about any programming language. Let's say it's the 1st version of the JRE. Combine this with a mechanism that effectively sandboxes an applet with whichever version of the JRE it needs or is most compatible with, and at worst, a user will be notified that they need to wait for a download.
In this regard, the designers of Java were thinking like programmers and not thinking of naive end users. Flash does a better job in this regard.