Works fine on my machines (recompiled for java 6u32 Windows 7 laptop and ran as-is on Java 7u17 windows 7 desktop). I jammed a great number of lines in there and I scrolled aimlessly with both mouse and keyboard, no problems.
So yeah... it shows the bug on your computer. Did you try on others? It just so happens that since Java 6 update 10, Swing has an accelerated drawing path through Direct3D which is enabled by default. What if you run the application with -Dsun.java2d.d3d=false, does the problem then go away? If so your video drivers must -really- suck.
Yup, adding -Dsun.java2d.d3d=false fixes the bug. It only happens on my laptop (tried 4 other systems - no problem on them).
I tried upgrading driver, no change.
Looks like the nVidia 8400M GS has a hardware glitch.
Using the -D is better than forcing a repaint(), so I'll use that. At least I know what the problem is.