Google was pretty much aware that GPL with Classpath exception was only for Java SE, not targeted at embedded deployments, but paying the license required for embedded deployments was too expensive apparently.
According to Gosling, Sun would have sued Google if they still had any money left on the bank, instead Jonathan decided to make the public support announcement, angering quite a few folks internally.
His blog posts are no longer live, but old references are quite easy to find.
