I found where they hid the Favorites on IE-7.
It's a little orange star in the lower left of the tool bar field.
The whole IE tool bar is now on the bottom of the tool bar field, instead of at the top of the field as it was before.
Toward the center of that bar (which doesn't even look like a tool bar) you click on "show other tabs". Then it becomes clear that this is your new IE tool bar.
It has all of the familiar icons like home, print, and best of all TOOLS with Windows Update, internet options, and so on.
The Refresh botton is the two circular green arrows at the top, right of center.
I hope that this is helpful.

Best Regards,
Robert