I have this same problem. iPad 2, iOS 7.0.4 - after the update, I cannot get my iPad to rotate into landscape mode. I have tried all of the same fixes listed above (lock rotation on/off, rebooting, even did a full restore from a clean wipe). Even the Reduce Motion setting did not work for me. Thanks very much for the tip on Assistive Touch because at least I can now manually put my iPad in landscape mode (I use mine with a bluetooth keyboard like a mini-laptop for work, so landscape mode is essential). Downside is that I have to re-apply the Assistive Touch setting every time I switch between apps.
I had no issues with this before 7.0.4, so I'm with Kevin - I suspect a 7.0.4 regression. Also, MacBot, to answer your #2 above, it did not rotate from setup assistant between being wiped and restored.
I plan to wait until 7.0.5 then trade in for a replacement if that doesn't fix it, I guess.