Do you have Windows Media Player 10 or above installed? It’s needed for an MTP driver, although you also can get the driver from a Microsoft porting kit.
The Windows porting kit includes the driver needed for MTP play. But if you have WMP 12, you’re already covered–you have it.
I wonder if it might help to go to the device manager section of Win7, de-authorize the Clip drive, and then detatch and reattach the Clip, so that the computer sets up the connection anew.
Great to hear! What, actually, did it–going through the device manager and deauthorizing the Clip? (I’ve never had to do it–perhaps posting a step guide here will help others.)