Thank you shadowfalls for your question/comment.

Actually I think white's 7th move is a mute point. It is not where he lost the game but decided to play his 'novelty.' Bd2 is about as strong as Nc3 but neither destroy white's position. Nbd2 is white's best line to retain a equal game. However, all three of these options are within a tempo difference <shrug>

wouldnt white's position be fine after 7.Bd2?