Ok, came accross this problem. After searching and searching, I downloaded the user guide ( who knew?! ) and the reason that is happening is because the Lumix DMC-FZ7 is not able to process an SD card bigger than 2 GB.
I switched it to a 1 GB and camera is back working!!
I hope this helps
What a coincidence! I was having exactly the same problem. I had bought 3 cards (a 16gb, an 8gb and a 4 gb) and got the same message as jesshofilena. My 2gb card works perfectly. I would have wasted my money but for the fact that I can use the three cards in my movie camera.
So, have you checked the card? Is the slide switch in the unlocked position? Are all the contacts clean? Is the card warped? Can you download the pics to your computer using a card reader?
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