Dstile like functionality has finally been made programmatic in World Wind allowing run-time tiling of imagery and quick import of file based formats such as Tiff, Imagine, ECW and MrSID into World Wind. ESRI ArcSDE formats will soon be supported by GDAL as well.
While implementing it I ran into some API bugs as expected. These need to resolved before the functionality is ready for prime time. The bindings are also a moving target. The developments in GDAL will need to be tracked to keep this functionality current.
As WWJava develops it will benefit from the extensive Java based format support in JAI, GeoTools and GDAL Java API.