I have an app that uses 256-bit AES encryption which is not supported by Java out of the box. I know to get this to function correctly I install the JCE unlimited strength j
You could use method
javax.crypto.Cipher.getMaxAllowedKeyLength(String transformation)
to test the available key length, use that and inform the user about what is going on. Something stating that your application is falling back to 128 bit keys due to the policy files not being installed, for example. Security conscious users will install the policy files, others will continue using weaker keys.