Wow, that's the coolest version of the sand game (http://www.fallingsandgame.com/sand/
) I've seen yet, it's a lot more slick than the original versions! I love the fluid simulation effect when stuff blows up! Do a google search for "Powder game" if you haven't already - there are some real cool videos made with this (some people have a LOT of time on their hands, clearly!).
Re: playing offline, it's an applet, not an application, so you'd have to get the jar and figure out how to launch it as an applet, maybe from a local html page or something like that, which you'd have to write yourself. It's not difficult, but I'm hesitant to spell out in detail exactly what to do since someone put a lot of work into it and I'm not sure how they would feel about offline play. The "right" thing to do is really to politely ask the author if he is willing to post a version for offline use and explain why you'd like it (I assume it's because you're often not at an internet connection, though in that case you could always just leave the page open in your browser, too). He very well may say yes, we all like it when people enjoy the things we've created.
Of course, Google is your friend, and the first search along those lines that I thought of led to a correct explanation within the first few results, so nobody's going to stop you...