Thats correct because ISP uses SPI interface for programming and JTAG uses Test Port signals as defined in JTAG specs. Thats why programming algorithm and signals used in both the cases are also different. Basically programming is achieved in two totally different ways.
I have successfully built JTAG ICE clone and it is working for me. yes you can program AVRs with this JTAG adapter, but only those who have JTAG port in it. Building AVR Jtag clone Testing AVR Jtag in action