I have had Java installed here for quite a while with no issue (C:\Program Files (x86)\Java\jre1.7.0_60) until now. I was thinking that I could find a way to make it work but DS was looking for it here (C:\Program Files (x86)\Java\jre7) which in the default java install location. I guess where DS looks for Java can't be changed. So the long and short of it...I uninstalled and installed in the default location and DS now installs. Thanks Karol!
Kind regards,
Kelly