If you have Razer Synapse installed for a Razer mouse and/or Keyboard,it will add a invisible _JAVA_OPTIONS variable to your environment variables. (It's a bug in the Razer Synapse.)
This was the problem for me.
If you have that software either uninstall it or add _JAVA_OPTIONS with the -Xmx flag you want.
Better explanation: Jumping over a carpet block and having your lower body pass through the air part of the carpet block causes the sound of landing on wool.
Still a concern in 14w21b.
It's easy to replicate just place down one carpet and jump over it a couple of times.
Added a 14w18a screenshot of the bug
Works for me in pre5