An FPGA like this is not a good choice for Java acceleration.. Java chips fell out of favor years ago, even ARM's implementation, because JITs on similar CPUs are faster. With an FPGA the situation is considerably worse than a Java chip implemented as an ASIC. To make use of an FPGA you need a task which you can extract a ton of parallelism out of or needs some really specialized functions, Java interpretation isn't either of these things.
The biggest reason why FPGAs are not a good idea is because no one is really prepared to write the HDL code to utilize them for the wide variety of applications that people are envisioning. In theory a decent FPGA could probably emulate things better than a similarly decent CPU, but in theory the DSP on Pandora could probably also help with emulation but no one uses it that way because it's a lot of work for an emulator that'll only benefit one device.
It's still a cool idea and it'd be interesting to see happen in some form, I just don't see it as likely to take off. Maybe someone should start with a lower risk platform, like a simple set-top box and let people see what they can develop on it. If something really novel comes out of it emulation-wise evaluate the possibility of making a handheld out of it. I remember there was supposed to be a handheld years ago with design by Ben Heck that was just this, an FPGA machine that played various platforms, but they only had Atari 2600 support prepared. Then they too decided to make it a console instead.. before ultimately scrapping it.
