This is because your variables aren't set right. Edit your run.bat and change
java -Xmx256M -jar .\jar\loader.jar -configurl http://www.runerebels.com/resources/config.agf
to
"C:\Program Files (x86)\Java\jre7\bin\java.exe" -Xmx256M -jar .\jar\loader.jar -configurl http://www.runerebels.com/resources/config.agf
It would be much easier to just set the path, that way he wouldn't have to reset his real path every time he has to download the client again.
All you need to do is just edit the path variable which you should already have, if not just hit new. Type in Path and then copy and paste the location of your java install, if the path variable already exists add a ; after the current variable value and then add your java install.
It will be something like C:\Program Files\Java\jre7\bin, or if you downloaded the 32bit on a 64bit OS it will be Program Files(x86).