Yes, 1.4.2 will be fine for preparing you for the exam. In regards to editors, this is really up to you, as it depends on your tastes as a programmer. I usually use JGrasp, which is available here. It's a no-frills editor which does not hog memory and provides some clean, simple utilities to develop your Java progs. I've also used NetBeans, which is a pumped-up IDE that will make your life easier as a programmer, but it will take some learning to get used to it.
A good lightweight editor is jEdit (http://www.jedit.org). Stay away from heavy IDEs and similar tools until you know the language well and can do whatever they do for you by hand at least as good or preferably better. An IDE should be a time saving device, NEVER a replacement for skills you lack.