You are experiencing a change in how the JDK prompt occurs, courtesy of the new JDev 12c IDE infrastructure SQL Developer 4.0 employs. Read the prompt carefully:
Please specify the path to the Java JDK home (e.g. C:\Program Files\Java\jdk):
So the new prompt wants only the folder, not the java.exe. In my case, the default value is C:\Program Files\Java\jdk1.7.0_25
SQL Developer Team
To the best of my knowledge, no.
I can certainly empathize about the loss of convenience not including a JDK may cause in some deployment scenarios. But keep in mind that as more features get added the product configuration becomes more complicated. For example, a feature might rely on Java FX, but only the basic JDK has been installed on the user's machine. Most users are moving to 64-bit execution environments, so would we ship the 64-bit JDK and not the 32-bit? Might Java at some point in the future require an installer so that a simple unzip will not suffice?
Perhaps a PM will jump in explain the full rationale behind this decision.