Another positive, and this is consistent with Amazon devices, is the identical firmware features across devices. What this means, whether you are using, for example, the Kindle Voyage or Kindle (the entry-level model), the firmware will be near identical in terms of features. The same applies to tablets, with the Fire 7 coming with the same operating system as the Fire 8 HD and Fire 10 HD. In all, the compromises made were just about right i.e. generally good performance, expandable storage and acceptable display. However, there are draw-backs that may have been considered:
(1) The screen is one of the low-end IPS displays that you also find with entry-level smartphones e.g. Microsoft Lumia 535. Understandably, with its low cost, the device will not have the colour vibrancy or accuracy of more high end hardware. Nevertheless, there is some difference between vibrancy and the low contrast and muted colours. Increasing the contrast makes a difference and can help with a relatively low resolution; for example, Amazon's entry-level Kindle, still boasts a higher contrast e-ink screen and this works to offset problems with its lower pixel density. This makes a significant difference and compared to other e-readers, with identical resolution, e.g. previous generation e-readers, the text is more legible and with darker blacks.
(2) The display is 'sticky' and a finger print magnet. For example, a stylus will not glide smoothly on the screen or even register a touch. Something simple like anti-fingerprint coating might help here.
(3) Why the cameras? The cameras, both back and front-facing, are mediocre. The Kindle Fire 7 HD (2013) offered no back camera and, in this case, it would be more justifiable not to include one. A trade-off between a needless camera with improving the display quality would have been the better option.
(4) Scaling - I think this has something to do with the aspect ratio. The device is fairly narrow and this means the scaling is off (the feel you get when you alter the resolution of a monitor from its recommended settings); what results is squeezed text in portrait mode and stretched text in landscape mode (Georgia, for example, comes out the worst in this). The only reason I can think of for the narrow dimension is to do with the intended use of this tablet for Amazon Prime video content. Turning the tablet in landscape, to watch a film, is probably the only thing that works with these dimensions.
With this being said, the Fire 7 offers a lot for its cost. As noted, other than offering identical features compared with Amazon's higher end tablets, there are other perks available. First, there is Amazon Underground - this offers many paid applications for 'free'. There are some good choices here e.g. Polaris Office, Quick PDF Scanner, Monument Valley, ezPDF, Office Suite Pro and much more. Also, as Fire OS 5.0.1 is essentially closed Android Lollipop, then external applications, from Google Play, can be installed on the device. There will be problems with some applications, e.g. Google native ones, that require the installation of Google Play. However, even for that, it is possible to install Google Play and turn the device into a more featured Android tablet. Second, this is also a good educational device for children, more so with Fire for Kids Unlimited. However, in my opinion, something like the entry-level Kindle would be better suited, with its distraction free reading and e-ink display (more healthy for the eyes and easier to read).
Overall, this is a good device for its price and would make a good secondary tablet or as an educational tool for children. It is not the hardware that makes the tablet a sensible choice, it is the all-round developed features and perks offered.