I installed Oracle JRE 7 (not JDK) for MacOSX but I can't locate where the JCE jurisdiction files are placed.
I need to replace them with the unlimited strength version.
I've installed the Oracle JDK, and if it helps, the directory in my case was /Library/Java/JavaVirtualMachines/jdk1.7.0_09.jdk/Contents/Home/jre/lib/security/
. Your mileage may vary, in which case just run find . -name local_policy.jar
and see what it turns up.