7 mpg empty is low brother!
My 98 has new optimizer (new, not a take out military), 4:10's, 4l80E, and 4x4. My tires are one size over BFG's (waiting for them to wear out to change them- $$$$$!)
Towing my 8500-ish lb 9 foot high x 8 foot wide TT netted no worse than 8-10 mpg.
Empty day to day driving (around town) nets around 13-14 mpg. Highway will return around 14-15 mpg. I hit a high once of 17.5 on highway empty running, but I'm pretty sure that was an error in the pump reading as I've never been able to duplicate it.
Remember that that diesel is inside the engine bay of a truck. IOW, more than what's going on under the hood can cause poor fuel mileage.
Some things to check for: brake drag (ie siezed calipers, etc), partially stuck on emergency brake, poor alignment (usually accompanied by abnormal tire wear), tire inflationn values, and finally - driving style.
Engine stuff like worn injectors, worn engine, clogged air filters, etc, will effect mileage but you have to remember the vehicle is a system and you must trouble shoot it as such.
If you have an old truck, it's very likely you could have a combination of things going on. For example; a dragging e-brake cable combined with worn injectors and a worn ip can all conspire to kick you mpg in the butt. Chuck in some low tire pressures and a tank of winter diesel and it can drop throught hte floor and hit an all time low and take the wind right out of you sails....
7 mpg sure does sound like you have a couple things going on at the same time. This is all assuming your math is good.....
Good luck hunting it down, i hope you find it. 7 MPG is pretty disheartining in the days of $1.36 a liter diesel........
Cheers