Well, despite my initial (and to some extent continuing) enthusiasm for the K7, I finally packed it up and it'll go back tomorrow. It is a great camera and in fact I went and handled a900, 5Dmk2 and D700 the other day out of frustration and frankly the Pentax just feels "right." And the Pentax glass keeps me here...
But in the end the new form factor just isn't comfortable for me to carry (again, I have a very particular style/approach so ymmv and take my opinion with a salt lick). As I never have really complained about the iq for the K20d, there wasn't much of a bump from the K7 other than much better AWB indoors. I also have gotten used to the AF performance of the K20d and anticipate pretty well. After shooting a lot of comparisons what I found was that there were some images where I preferred the K7, but an equal number where I preferred the K20d (all shot raw and developed in either Aperture or Raw Developer). I could almost always tell which was which, and the K7 is probably more "accurate" with metering but I actually like the way the K20d exposes for what I shoot. Part of that could just be that I'm used to the K20d look.
The other big feature of the K7, video, turned out to not send me. While I have seen some great examples, the reality is that my DLux4 captures HD video with excellent low light performance. I also have Canon HD miniDV cams, and I've come full circle back to my original arguments against video on dSLR. I do a lot of run and gun and while a camera like the XH-A1 is much larger, it is easier to shoot with, does handheld well, and has built-in robust sound capabilities. And I'm lazy - the less I have to think about what I'm doing other than seeing the shot, the better.
My take at this point is that there are a variety "still cam" video implementations out there, so for quick and dirty my DLux4 will do the job, and for more serious the XH-A1. The dSLR does give the DOF advantage so if that is important to what you're trying to capture then the K7 is great. Or if you just want to carry one camera and grab occasional video it is great. In my case I'd likely just carry DLux4 and K20d to cover my bases as I can pocket the DLux4. As I said, I'm lazy. Shooting video on a dSLR is just too much work at this point
At any rate, I certainly think the K7 is a great camera and I can see why most (all?) are very happy with it. But to go along with that, the K20d is a great camera as well. And for me, the form factor is a better fit. For instance, the 50-135* certainly balances better (again, to me) on the K20d than on the K7. But any of the DA or FA ltd primes on the K7 creates a small/tough/elegant package that frankly I don't think Canikon can touch. I was thinking today a 15/43/77 with K7 would be an amazing travel setup.
In a perfect world I'd have both K7 and K20d depending on my mood, but I'd rather buy some more glass and keep shooting the K20d while looking for the "ultimate" street cam in-between the DLux4 and K20d.
For those with K10 or earlier, I think the K7 is a "no-brainer" upgrade, especially if you want video and some of the other features. If price is an object, I think the K20d is a great choice if you're actually willing to learn how to work with the camera, and use fast glass.