Version 1.5.0_07 is the latest. Do you know where your plugins directory is? If you just have one user account, then it'll be ok just to make the link in ~/.mozilla/plugins (check if you have this directory). If you have multiple user accounts, then you'll want it in a directory that every user has access to (e.g. on Slackware 10.2, this is /usr/lib/mozilla/plugins, but it may be different for your distro).
Now, I'm using JRE 1.5.0_04, but I don't think they've changed where the files are. If you have problems, we should be able to fix them
You make the link as follows:
ln -s /path/to/jre
Replace the first bit in bold with the actual path to your JRE, for me this is /usr/lib/jre-1.5.0_04. The second bold part may need to be changed, depending on where your plugins folder is.
You won't need to do this as root, since you're making the link in a directory under your home (unless of course, you're putting the link in a directory multiple users can access).