Joe, if you set your timing light at 7 and then timed to the red mark, you would actually have 14.5 degrees initial advance. Your car should have increased idle speed as it has to much inital advance per factory specification.
One of the first things I do is verify what the marks are. All factory impellers (supposedly) had TDC marked if nothing else. On a 1.8, the timing mark is 14.3 mm to the right of the TDC mark. On a 2.0, the timing mark is 55.5 mm to the right of TDC. This measurement is facing the fan.
The above is why I said to look for a 0 or hash mark 14 mm to the left of the red mark on your car (facing the fan), which should be true TDC.
Alternatively, there is a hash mark on the flywheel that lines up with the split in the case for TDC. You can't see it from the top of the engine, but it can be seen through the hole in the tranny from the bottom. If this were lined up with the split in the case at the bottom, and the PO had made the white mark 180 degrees from the red mark ... you would see the white mark in the window on top.
That said, in my experience, I have seen where the flywheel TDC mark and the impeller TDC mark did not line up as they should have. Can't tell you why, but I have seen that. I wish I could be there to help.
And for that really short guy from Texas, Randy Neuman said it best when he said they have tiny little feet, tiny little hands and a nasty attitude.