My Web Application that launches IE uses the following simple VB script to hide toolbar..
Set objIE = WScript.CreateObject("InternetExplorer.Application","objIE_")
objIE.StatusBar = True
objIE.ToolBar = False
objIE.MenuBar = False
It has worked for IE 5.5., 6.0 ...so I am wondering why it is not hiding the toolbar for IE7