I think Indiana CAN win 7 games next year, but wouldn't bet on it. Indiana is capable of beating:
Illinois
Idaho
Western Kentucky
Nebraska
Maryland
Rutgers
Purdue
And while I don't foresee Indiana beating Cincinnati or MSU on the road, those are two teams Indiana played extremely last year who will almost certainly take a big step back.
I will be happy with bowl eligibility this year, and while it's definitely an uphill climb, it's not unrealistic.