I am pretty sure this will be of no help to you, but:
I downloaded IE7 as IE6 had a problem, i must have done some thing to it. The second i opened it up i didnt like it, used it for a few days and for some reason hated it.
So i am now using firefox and not looking back to IE7 at all...
I think you have to select a default seach engine on the new IE7, from what i can remember Google wasn't there, but if it was i would have selected it just to p M$ Off...