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Java's speed isn't that much different than C++ anymore. Sun has really improved on that with the last few revisions.
That being said, graphics in Java ARE slower. Java doesn't have direct tie-ins to graphical API's like C++ does. So when writting a graphically intensive program, yes you should do it in C++. Especially 3-d stuff, as Java doesn't really have an API for it, and doesn't tie in to OpenGL or Direct3D. But for things such as web-services or servers, Java works just fine.
The VM is what allows you to compile once, run anywhere. Yes, you need to have a VM installed, but that's trivial. Apple has their own. For BSD users, Blackdown does a Java implementation. And for Windows/Solaris/Linux, Sun's implementation is just right.
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