Since the 2012-006 update to Apple Java, the Java Preferences pane has disappeared. Apple says that you install the latest version of Java from Oracle in order to reinstate support for Applets. But the JRE 7 is 64 bit only and explicitly doesn't support Chrome. Has anyone worked out how to get Applets working again on Chrome since 16 October??
I had the same problem too. I have a Macbook Pro with OS X Lion. I too updated my mac with the 2012-006 update and it broke Java applets on Google Chrome.
After a lot of researching, I got to know that Chrome is a 32-bit browser and does not support the 64-bit Java 7 from Oracle and there was no way to run applets on Google Chrome on a mac until we get a 64-bit release of Chrome for the mac.
So, I went to the Mac App Store > Purchases tab and downloaded OS X Lion and installed it over my existing disk. Note that it seems like a big deal, but it went well for me and your data and settings do not get erased/reset. The old 32-bit Apple JRE 6 gets installed and until Google Chrome 64-bit is released, you can keep using it without problems as long as you don't reinstall the 2012-006 update.
It worked for me, so it should work for you too. I'm not sure if you have Lion or Mountain Lion, but I think the same trick should work for Mountain Lion too.