I don't believe that this is the case.
Application builder is really very specific about what files are available and in what state. Though it is not really documented anywhere to my knowledge, the proper steps to building an application are as follows:
Before doing this, LabVIEW should be closed, and all other VIs out of memory.
1. Open your top level VI.
2. Click the run button to recompile
3. Choose "Save All" from the file menu
4. Close your top level VI and ensure that all VIs are saved properly.
5. Quit LabVIEW
6. Open LabVIEW - DO NOT open any of your VIs. Open LabVIEW from labview.exe via the start menu or other shortcut!
7. Open a new VI.
8. Open the application builder (tip, I went into the projects folder and
pulled a shortcut of the app builder out and onto my start menu, this opens the app builder fresh after LabVIEW has been exited.
9. Proceed with your build as normal.
The problem is that LabVIEW retains VIs in memory, even after they are all closed. If there is anything incomplete about these VIs, this will affect the build process. Unsaved VIs do not show up as being valid files (or something like that) to the app builder, thus if you didn't save even one single VI and try to build the application, you will get an error 7.
Step 1 is specific to your case, as recompiling ensures that all external connections are properly made.
If you still have the problem, post here and let us know.