The tidbit about the buffer chip on the memory is an oldie but a goodie. I apologize for not remembering it in our earlier discussion. Interesting old discussion here:
http://duc.avid.com/archive/index.php/t-18582.html
Also, the R7000 most certainly will work in System 7.6 with or without drivers. It does sound like your card is a PC card without proper Mac firmware installed. The PC versions of the cards have a Flash chip with 1/2 the capacity of the Mac version. To convert to Mac version, one must either use an edited version of the Mac firmware (has issues during start up splash screen and such) or replace the 8 pin flash chip. Replacing the flash chip is really pretty easy. AS mentioned, there are only 8 pins, and it's over by itself near the top front of the card.
One version of the ATI updaters will flash a blank chip in a Macintosh with the Mac firmware and you can update to the last, latest version from the there. The "special" version ended in 2.08, IIRC. I converted about 100 of these back in the early 2000s. I always replaced the chip. Others flashed the modified ROM onto the smaller flash chip, but this has a couple of problems. It has the issues mentioned above about display during the boot process, and it also means that updates either can't be done, or updates require the same amount of work as the original flashing of the card. Now days, with no new updates, it doesn't matter as much. Back then, it made a difference.