Agreed.
After expanding the file on your computer, be sure to do a checksum. That is, look at the file's properties and make sure the size is the same as noted on Canon's site, in their instructions.
Also be sure to use a memory card that's been formatted and has nothing else on it.
You probably already know that you have to be careful not to press any buttons and the camera must remain on until the firmware update finishes.
It's also a good idea to do a full reboot. In case you don't know, that involves removing all the batteries, including the little silver one, turning on the camera without the batteries and pressing the shutter release button once (it won't fire, but this clears any remaining power in the circuitry)... then put the batteries back in. If you got a full reboot, you should need to reset the time/date, at least. You might need to redo some menu and custom function settings.
I have done this update (and earlier ones) on two 7D without any problems. I think most likely you got a bad update for some reason. If these don't solve the problem, I'm afraid it's back to Canon with the camera.