IE7 in 2003 would have been much better than the IE7 that actually released.
The reason for that is that Microsoft disbanded the IE team after IE6. So to release IE7 they had to create a new team, get them trained up on the codebase and release something. And they were under time pressure, so they released as soon as they had something better than IE6. This took them probably 1-2 years at least between the learning and the coding.
If instead they had kept the existing IE6 team and had them work on IE7 back in 2001, they could have spent a full 2 years on development and delivered something significantly better than IE7 as it shipped. The difference from IE6 to that something would have been about like the difference from IE8 to IE9.
The reason for that is that Microsoft disbanded the IE team after IE6. So to release IE7 they had to create a new team, get them trained up on the codebase and release something. And they were under time pressure, so they released as soon as they had something better than IE6. This took them probably 1-2 years at least between the learning and the coding.
If instead they had kept the existing IE6 team and had them work on IE7 back in 2001, they could have spent a full 2 years on development and delivered something significantly better than IE7 as it shipped. The difference from IE6 to that something would have been about like the difference from IE8 to IE9.