Officially Matlab versions 2008b and before are not supported for use with windows 7. See:
User contributions on the web indicate that older versions of Matlab use JRE versions that do not go well together with Windows 7, and suggest that replacing the Java version in the Matlab directory with a recent one may solve the problem. See:
Java JRE versions delivered with rMatlab
|Matlab version||JRE version|
Typically one should install version 1.6 revision 12 or later to obtain Windows 7 support.
When updating from version 1.5.0 (R2006b) to 1.6.0_xx, some Modelit JAR files also need updating.
Modelit has not tested this.