You can install multiple Java runtimes under Windows (including Windows 7) as long as each is in their own directory.
For example, if you are running Win 7 64-bit, or Win Server 2008 R2, you may install 32-bit JRE in "C:\Program Files (x86)\Java\jre6" and 64-bit JRE in "C:\Program Files\Java\jre6", and perhaps IBM Java 6 in "C:\Program Files (x86)\IBM\Java60\jre".
The Java Control Panel app theoretically has the ability to manage multiple runtimes: Java tab >> View... button
There are tabs for User and System settings. You can add additional runtimes with Add or Find, but once you have finished adding runtimes and hit OK, you have to hit Apply in the main Java tab frame, which is not as obvious as it could be - otherwise your changes will be lost.
If you have multiple versions installed, only the main version will auto-update. I have not found a solution to this apart from the weak workaround of manually updating whenever I see an auto-update, so I'd love to know if anyone has a fix for that.
Most Java IDEs allow you to select any Java runtime on your machine to build against, but if not using an IDE, you can easily manage this using environment variables in a cmd window. Your PATH and the JAVA_HOME variable determine which runtime is used by tools run from the shell. Set the JAVA_HOME to the jre directory you want and put the bin directory into your path (and remove references to other runtimes) - with IBM you may need to add multiple bin directories. This is pretty much all the set up that the default system Java does. You can also set CLASSPATH, ANT_HOME, MAVEN_HOME, etc. to unique values to match your runtime.