You use :1 as display for your X VFB. You set your $DISPLAY to *:0.0 where the 1st zero tells which X server and the second the display. Maybe you got a mismatch there.
My guess is, that the correct place to export the $DISPLAY will be most probably the environment where you start your webserver, where the JAVA app runs in that uses the VFB, ie. when you start it make sure the correct $DISPLAY is exported.
To check if your VFB is running correct etc., check out this:
IBM - The X Virtual Frame Buffer
Else there is a lot of posts in other forums etc. relating to the error message you get and most point to the thing described up there.