As all are aware Java Applets run on the client and except in a corporate environment it is difficult to edit the policy file. Added to this is the problem caused by explicitly defining where the log file is to be written since even if only targetting at Windows the "Documents and Settings" may not be on the "C" drive and on Windows 7 "Documents and Settings" is not used.
Since modifications to the policy file are not specific to a particular Applet they can be a security nightmare. When working with Applets it is normally best sign the Applet and then to only use a users home directory (System.getProperty("user.home")) or the temp directory (System.getProperty("java.io.tmpdir")) since these are pretty much guaranteed to be available.
I'm not overly keen on Logging especially in Applets. To my mind Logging is primarily creating an audit trail (especially when things go wrong) and if the log file is on the client how is the Applet writer going to access the log file?