Windows 7 supports dual monitors just fine, so I would suspect a setting or compatibility issue with the notebook, or the docking station. You might check the docking stations website for tips and to ensure you have the latest drivers for Windows 7.
I can't explain the 3 reboots thing. ???
I cannot live without two monitors, and while Windows 7 is better than previous Windows, I still recommend the use of a good multi-monitor utility. I use and recommend
UltraMon – not free, but worth it. It has the option to set profiles that may serve your purpose. Others have suggested
DisplayFusion as a free alternative, though I have not used it.
One problem with notebooks is that the "Primary"...