Java's standard library is one of its worst features. A fork could just throw this crap away and it wouldn't be too far off.
But honestly, people don't use Java because they want a good programming language. They use it because they're already using Java. That will be a problem for both Java 7 and any future fork.
Ditto. Though I'd narrow "cross platform" to non-Microsoft. No hate for MS, but I don't see deploying Windows servers and associated licensing costs any more likely for me than buying Oracle licenses.
So yeah, as a small Ruby shop that was looking at JRuby as a stepping stone to a robust VM, this concerns me.
Longtime Java dev here, I'd say taking Java, and the JVM, and creating a NEW set of libraries would be awesome.
As you said the Java libraries are total crap. Sun was for a while hell-bent on throwing out everything that's good while putting in a lot of badly designed ugly classes. And some things, like AWT and Swing, were just crap from the very start.
A fresh start would be awesome. The main thing that's currently good about Java is the JVM, and Eclipse. Ruby is infinitely more elegant but the dynamic typing and lack of IDE support kills it for me.
But honestly, people don't use Java because they want a good programming language. They use it because they're already using Java. That will be a problem for both Java 7 and any future fork.