I think it really depends on the game. I've seen this go both way where the i7s significantly outperform the i5s, and vice versa. The other advantage of a faster CPU is that it will open up so that the graphics card is sure to be performing at full potential.
This site shows the i7 leading the i5 in most games by a tiny-to-small margin
http://www.ocaholic.ch/modules... (random site I found on Google search):
Ultimately I think the big win for the i5 is you get nearly identical performance of an i7 (for a game), but for a much greater value. I have never read, other than your comment, that hyper-threading is a performance hit. I would love if you could point to some post / site with more info backing that claim. Cheers.