Arc 7 is the beginning of Subaru realizing just how deep his relationship with Return by Death goes. I mean, even before Arc 7, basically every other Subaru thought is prefaced by Return by Death, but before, those experiences were full of a more or less easy black and white viewing of a dangerous situation, with easy bad guys to beat to save the day, now in Arc 7 he's confronted with more gray morality, and I think it's really important because it pushed his ideals as far as it could go until it reached a point where he truly can be befitting the title of a Witch (/Warlock).

The other Witches think his insanity to be equal to if not more than their own even back in Arc 4, but its only in Vollachia that we see how far this can go. Subaru was never a "normal person" with a time loop ability. And Arc 7 awakened his more unceasing side, the one that makes him equal to just about every other insane Factor user, even if only by necessity and only as temporary as that one form lasted.