For moderate computing the i5 is idea, but for hardcore computing (normally found in desktop replacements) an i7 is the only way to go!
Gaming isn't the only reason one would go for an i7. You forget about video editing, the ultimate CPU test. This is where you will see a different in the Intel Core Processors and older processors. It's the hyper-threading that helps you encode video and watch a DVD at the same exact time, without lag and delay in the DVD stream. Think of someone who wants to quickly encode and then stream video to the web--that person would want, if not need, a i7 to get the best possible results without shuttering in the stream.
For most people, the i5 is the perfect in-between that's not too power-hungry, but also fast enough to do some heavy work when needed. As for battery life, look to the Apple line-up. An i5 and i7 are supposed to have the somewhat same battery life. Now, is this due to a bigger battery, or the processor?
The new chips can shut off cores that are not in use. Advanced cacheing make RAM accesses less frequent. All the Cores are very efficient, and use stepping to help save power. Under minimal to "normal" load, I'm sure the chips are almost on the same level of efficiency, it's only about the time you ask it to do more you'll see a bigger battery drain from the i7.