Although I haven't yet worked with the 7D. My friends are all buying 7D's so it's just a matter of time.
What little I do know is I would transcode to ProRez using Canon's E1 L&T plug-in to ensure it conforms to Canon's colorspace. My understanding is that is the recommended workflow.
If you haven't already come accross this, then perhaps the conform retiming workflow described in the video tut may be helpful.
Haven't really looked into Twixtor, etc.
http://philipbloom.co.uk/2009/05/30/how-to-convert-canon-5dmk2-footage-from-30p- to-24p/
Don't know what your final out is or if you are linking to the Red files in Color, etc.
But would be curious to know what you end up using as your workflow.
At least you don't have 3k Red footage. 🙂.