Are you trying to run a CA during the java install??
If you are you might need to get your timings right. Since the wonderful Java MSI 'isn't', its just a bunch of CAs, you will need to wait until the install has actually finished, then written the change to the Path statement, and then you can call java 'from anywhere'. The reason it works if you copy the java.exe into the System folder is that it is already loaded into the path statement.