My vet recommends DAP.
I have no personal experience with it though.
What is her "den" like? If it's a large space (like a big ex-pen) with lots of room to run around and something like a litter box (potty area??) I wouldn't be too worried about it teaching her to pee in the house later on.. But if it's a really small area, yes it might be a bad idea to let her potty in there. That's how puppies get 'dirty dog syndrome.' I've seen some puppies come from a bad breeder who crated them for too long; These puppies never learned to be clean and just soiled their crates all the time. Very distressing for the owners.
Maybe try to make her potty area a little more obvious as a potty area? What is she used to going on? Grass? Newspaper? Puppy pads? There are pads you can buy in the stores that have a scent designed to make the puppies feel the need to potty there. Maybe give something like that a try (personally I found my puppies would rather shred it and eat it lol). There are also those big patches of grass you can buy, specifically designed for dogs to use (again though you'll need a big area, not just a crate).
I've always heard that one of the best tricks for lonely nights is to put the puppy in an (appropriate sized) crate, and put the crate on the bed with you. One of my puppy owners from my last litter did this (she's been breeding for YEARS and swears by it). He was the naughty NOISY hellion of the litter, and within a week he was able to be crated quietly in the other room with the other dogs. Turning the radio on can help too, and there's always the theory about lettign the pup lay on something with the momma dog's scent.
I wouldn't be too worried about 7 weeks either; You are right, it's a legitimate theory about the 8 week fear period. Funny enough, all of my puppies go through their fear period at 7 weeks (so it seems), and I have to keep them until 8 weeks anyways (to do evaluations). I've always wondered if it's different between breeds or lines. Anyways it's not that much of a difference, I doubt you did any harm (though I certainly wouldn't recommend any earlier than that).
Good luck!
If you get the DAP, let us know how it works, I'd be very curious.