I updated the recommended Java and LW opened fine. I installed the 64-bit Java and then had exact same issue as you.

Only way I could get LW to work again was to uninstall the 64-bit Java and re-install the 32-bit Java despite it already being installed. LW then opened fine.

And no problem, LW will revert back to using the old preferences location and the prior download location.

A few days ago someone had same issue but they were trying out Windows 8 so I presumed it might have been something odd about the new Windows version. Seems it is a LW and the newer 64-bit Java issue.

I am guessing this is a LW 5 only issue, same as the Java 7 issue only affected LW 5 versions. I will check LW 4 out later after some sleep.

Now I remember why I adopted a practice a decade ago of only updating software after reading user feedback about whether the updates were safe/ok without introducing problems. When you are using particular software for work, you cannot afford problems some updates can cause. I won't waffle on about that but it still holds true for many softwares, including so-called upgrade versions. (The software company pushing you to pay extra pennies to buy more (new) bugs.) Anybody name me any software where the upgrade version did not require later bug updates. I often suspected it was deliberate.