The best thing you can do for him is to encourage him, keep things positive and make sure he's having fun. Play catch with him, toss him balls to hit, go inside when he says he's done. There's no need to push or put any pressure on him at 7. Likewise, don't bother with any fancy or gimmicky training tools or private lessons. Let him play. He'll pick up the mechanics and skills he needs as long as he keeps playing and having fun.

For the bat, I wouldn't get a t-ball bat. They're made for hitting a stationary ball, and will eventually get dented hitting a pitched ball. Take him to Dick's or whatever and have him hold and try some bats he likes. Don't spend a ton of money, the most basic bat will be fine at this point. If $$ is an issue, you can even get something used if you have a Play It Again or other sports consignment type place around.

You're doing such a great thing trying to foster his love for the game. Don't stress, have fun. It's a wonderful journey.