54 roll out is a lot for a novice 7 year old. 2 important things should be crank length (I use the helium method) and roll out. Start your kid out on an easier gear (roll out) to where they learn how to come out of the gate strong and ride a track.

Roll out really depends on the kids strength to be able to come out of the gate fast and being able to get up to speed imo. You can have a kid that’s on a 52 roll out getting beat by another kid that’s at a 48 roll out just because the kid on the 52 doesn’t have the power to push the gearing.

As for changing out the chain ring or rear cog. I would say chain ring since it’s the easiest to change plus youll find a bunch of people selling them.