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It's the bug (or feature) of Chrome:

http://stackoverflow.com/a/13648431/507072

Someone should really spend a second thinking about what use that API with that behavior is to developers. And then not implement it anyway, because it's not in the spec.

I think it dates back to when Netscape had built-in Java.

You can tell if Java is running in your browser by testing it here: http://www.java.com/en/download/testjava.jsp

I prefer: http://javatester.org/version.html

Tells you whether it's loaded, and what version you have loaded. No frills, no crap website.

It made me actually check and make sure that I had disabled the plugin. I thought I had already done it.

Same here. Appears to be disabled http://www.java.com/en/download/testjava.jsp

Returns true even though I have Click-To-Play enabled. Cannot decide if that is accurate or not...

That makes sense. If you have Click-To-Play you do have Java, so returning true is correct.