Same problems!! I just upgraded from version 6 to version 7.04 yesterday. I made some major changes to a site, then tried to upload to Dreamhost as usual and it failed. I googled the issue and found this page.
DW 7.04 will do export process then when it starts the upload process it stalls and nothing happens. Finally I get an error. All my FTP credentials look like they got imported properly. As a test I dragged RW 6 off my back up drive and opened it. I was able to FTP no problem!
I remember when I jumped from 5 to 6 it was unpleasant and I had FTP issues with that until something got resolved. Maybe I should have waited another 6 months to upgrade to 7.
Considering I maintain a number of sites and don’t have time to fool around, I keeping everything else on RW 6 until we can find a solution to this 7.04 FTP issue.