Bobby,
I think that studying for the 1.4 exam is a lot easier than studying for the 1.2. The AWT and IO topics are very large so their removal greatly reduces the amount of material that needs to be covered. The new assertions topic is very easy. The document,
Programming with Assertions, provides all the information that you need.
The removal of the AWT and IO topics allows the 1.4 exam to include a lot more questions on
Java fundamentals. I don't think that increased depth in the fundamental areas is a problem. I think that learning a narrow set of topics to a greater level of detail is easier than learning a wider range of material to a lesser level of detail. If you try to learn a wider range of topics to a lesser level of detail, then it is more difficult to determine how much detail is enough to pass the exam. If you are required to study a narrower set of topics to a greater depth of detail then you can just go ahead and study until you think you actually know the material.
My advice is to study for the 1.4 exam. The 1.2 exam will soon disappear anyway.