Using Java as an applet is good for where you help the users fix the problems with applets. This is based on my experience for developing a Java Applet for a domain named administration system. After a few months of operation the Java Applet was too difficult to support. It is might be ok for the admin interface, though I recommend AJAX for the front end and Java is fine for the backend.
AJAX compared to Java is not that great, expect the reality is the main stream market likes AJAX allot more. By using a java applet you will limit your user base.
Why it is this way is quite simple, if there is a problem it is too hard to fix. The multi step process to get the errors, email them or speak to you over the phone is very difficult process. Most users would rather not answer the survey. Microsoft made sure Java never made it main stream, hence the billion dollar lawsuit they lost.
Your clients, the ones using a admin interface may be willing to use a Java applet interface and fix problems when the come up. Expect only if you provided features that Java could do better then what AJAX could do and your competitor does not offer a better system.
