Here is a guess-work form:
Joe McGinn Author of Inside LotusScript,
( available August 1997 )
http://www.browsebooks.com/McGinn/
6/26/97
Java will have access to the Notes object classes (i.e., like LotusScript). Java will have the advantage of being a portable language that can program user-interfaces. You should be able to do things like design a dialog box that displays a selection list of Notes documents (i.e., like the @Picklist function in Notes) for a web client.
LotusScript will still be better integrated with Notes (i.e., in the programming panes, for event programming, etc.) so it will probably continue to be used for backend agents and front-end agents that do not need advanced user-interface access. The Java code itself you will probably have to actually write in a text editor or an external Java tool.
Notes 5.0 is also supposed to support Java Beans, the Java component standard. I'm not sure if you'll be able to run these components in the notes client, or just in a web browser. I know the eventual goal is to have parity in functionality between the Notes client and web browsers, but I don't know how far they will get in 5.0.
This is all based on published interviews and white papers by Iris employees.