In build_scripts.ini there is a path to your java.exe, by default it has wrong subcatalog names (at least it had for my version), so just make sure the path to exe file is right, also remember to update it again if you reinstalled the game.
Yes, jre is what you need, jdk is for developers/programmers.
It doesn't matter at all, bin extension has wide variety of content and can be associated with many programs (also videos that's why it automatically associated with vlc), but in this case it's prolly archive/data package.
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