MySQL is a joke, always has been...
But is MS SQL Server any better? I heard a MySQL rep from Sun comment shortly after the Oracle deal to acquire Sun was announced that it might be Oracle's intent to use MySQL to compete with SQL Server. I don't see any less reason to believe his statements than yours above on the face of it. Innobase, the developer of the InnoDB transactional storage engine for MySQL, was acquired by Oracle some time before Oracle acquired Sun. Maybe Oracle has a higher opinion of MySQL than you do.
MS SQL is essentially the number one threat to Oracle's business in the short term, since for the vast majority of cases it's a perfectly viable solution, generally costs less(presuming you already have any MS products in your organization), and to be honest, Microsoft are a lot nicer to deal with than Oracle.
Seems like more of a reason for Oracle to keep MySQL going than Java.
Understanding is always the understanding of a smaller problem in relation to a bigger problem. -- P.D. Ouspensky