Nothing to be concerned about. It is a "normal" function of 7. Actually Vista did thr same. They assert themselves as C, and everything else drops into place under that. It plays hell with your paths.
You can avoid it by installing 7 (or Vista) from within the other OS. For example, if you have Vista, already on C: and install 7 by running the DVD from Vista, 7 will then become D. which is what we desire.
Yor other problem, with 7 not seeing the other partitions/drives. :
Control Panel - Administrative Tools - Computer Management - Disk Management.
You will see in the window which then appears, that the other partitions/Hard disks, have no letters. Assign letters -( Right click each partition - "Change Drive leters and paths")
You will now be able to see the other partitions/paths from 7.