Well then I apologize for my lack of video knowledge... so it's 3 X extra reach then not 7 times? A nice to have feature I'm sure.
It's a little over 3x compared to 1080p video, and more like 5x compared to 720p video.
Even so, that's A LOT. I often use a 100-400L with 1.4x TC III. That's 560mm real focal length. With the crop mode, you get the resolving power of an over 1,700mm lens on the 7D with 1080p video. And when shooting planetary photography, it's essential. Framing Jupiter requires an equivalent of around 100,000mm depending on time of year. Even with my 3,800mm telescope, the 1.6 crop factor and the 7x video crop (even if it's only a little over 3x in real resolving power) are the difference between a shot with some detail, and a white dot.
The T3i (I think) has a 3x crop mode for 1080p video. Nice to be able to triple your real resolving power with the touch of a button.
This is all because of two things - video is low-res and stills are high-res, and video soaks up huge amounts of storage. If neither of those were the case, we'd just do what we do with still - crop in post if necessary, which is why digital zoom is more-or-less useless (it's nice if you just don't want to take the time to crop in post, but it doesn't actually buy you any real resolving power). So, as long as we aren't storing all our pixels when shooting video like, say, RED does, video crop modes (called "windowing" often in the video world), are useful.