Hi,
Yes, you are correct. 7.0 and higher version of pix code are not supported on Pix 520. And I would not try to upgrade the pix 520 to any 7.x version.
For what its worth, when I tried to upgrade the pix 520 with 7.0 code, the pix crashed with watchdog timeouts and I had to revert back to 6.2 code. So, if you are planning to upgrade the pix 520, make sure that you have a back up plan.
Regards,
Arul