The real issue is that the jdk version this version(actually not only this one, if I'm not mistaken IDM 10.1.4.0.1 is as well) is shipped with (1.4.2_14) has some error that prevents SSO from working, the solution is a simple one - install a higher version (say 1.4.2_19).
Now, these things get me really frustrated. OK, I get it, your error handling is not the thing you take pride in (sure hope not), but it's not the first time (more examples to come in following posts or you can read this post again [last example]) it seems nobody have really tested the final product. Had somebody taken the final product (with jdk 1.4.2_14) about to be published for everyone to download, installed it and tested it for the very basic functionality this error would've been discovered (and hopefully the product wouldn't be published).
That's the part when I start to imagine the following conversation (a special bonus for whoever discovers the meaning behind the aliases):
M: "Hey, there's a new jdk out! We should ship 10.1.2.3 with it because it's the newest" (and new is good, right?)
S: "But we tested it with 1.4.2_x<14!"
M: "Yeah man, but we didn't really touch something that heavily depends on jdk specifics, it's a minor version anyway."
S: "You know what, you're totally right, let's do it! It's not like we've ever shipped any totally-unworking piece of code before."
Really, with the simple applications we have in my company we try to test them thoroughly and even though not always successful try to enforce different rules before deploying, things like a certain period of time in which the application has to work on a test environment without code modifications before moving to production, a clean testing environment for relatively big installations, etc..
So how come Oracle manages to ship a totally not working version of a product?