The only reason I still have Java installed on my OSX machine is to use a SQL Server management tool. If I were to run that in a virtualized environment by installing Parallels and running a separate instance of OSX in that virtual environment, would that completely isolate Java to that one "box" and protect the rest of my environment?
Does the management tool run as Java web page plugin, or as a standalone Java application? If it's the latter, just disable the Java plugin in all of your browsers and you should be safe.