I do not understand why people always associate dynamic range with pixel size. The Nikon D7000 has wider dynamic range than the Canon 5D despite the smaller pixel size.
Uuuh, where did you see that people associate DR with pixel size? As I understand it, DR is the amount of different stops (from lowest to highest) the camera can record on one shot.
Dynamic Range is the ratio of the largest to smallest signal that can be recorded. The largest signal is the maximum number of electrons that the photosite can hold (full well capacity) and that scales with the size (area) of the photosite. Therefore, DR does go up with the size of the photosite for a given noise level.
Important to note that the size of the photosite (the light sensitive part) is not the full size of the pixel... the amount of space it takes up is called the "fill factor" and has typically been less than 50% but that may have been something that Sony has improved upon.
The Sony sensor in the D7000 was a great improvement because the the full well capacity is almost as high as the 5D (the 5D2 is larger). The read-noise at ISO 100 was also reduced in the Sony sensor. The net result is that the D7000 has a very large DR.