Check a couple of things. Is the gauge swatch done in stockinette stitch or is it in a pattern stitch? Are you knitting a good sized swatch (about 5" x 5") so that you can measure gauge accurately over the center 4 inches?
Pattern gauge is 5sts/inch. On the size 5 needle you get 6sts/inch. How many sts/inch are you getting with the size 7?
Which pattern in the VK winter 2008 issue are you making?