The iPhone 7 can't run iOS 16, it can't even run iOS 15. Its literally running the iPhone 7 version of iOS 15. iOS 15 Lite...
There is what? 50 or so features the iPhone 7 hasn't gotten over the last 3 updates because it either completely lacks the hardware (FaceID camera, Neural Engine, Wireless Charging, Fast Charging, BT 5.0, etc) or lacks the computational prowess with the hardware it does have (can't use car or hotel keys due to lack of security, no high detailed city maps, background animation in weather, portraits in FaceTime, really basic stuff).
Why want an update when you aren't getting anything more then a couple UI changes? At this point you could pretend you got iOS 16 and it wouldn't be much different then the version you would have actually got.
The API's and features Apple forced onto the device literally kill it. Using VR with ARKit kit makes the phone (and its battery) so hot many consider it a safety hazard to have it that close to your face. HEVC decoding is poor at best, other iPhones transcode the h264 version for it as if they feel bad...
Apples kept the thing on life support purely to get the 6 year mark. Its been a hinderance on everyone involved including 3rd party developers that need to make their apps/games appealing to iPhone 13 users and somehow function at all on the iPhone 7 and 6S. The iPad 5th gen is the same way, but Apple is gonna support it for another round of iOS just to get to that arbitrary 6 year mark.
Now many will say, I don't need/want portrait mode in FaceTime, spacial audio, wide spectrum, spatial audio, HDR playback, Live Text, Quick Zoom, Siri offline on device processing, walking steadiness in the health app, etc etc and thats perfect, you aren't getting anything you didn't want. Ironically its usually the people with really old devices that say iOS has gotten stale when its actually because those people have basically been using very very mildly updated version of iOS for several years.
It will still get security updates and it will still function just fine. You could use it for a years to come. I wouldn't blame someone that keeps using it if it still works, its just odd they are mad about it. My iMac on Catalina I'm typing this on works just fine. I knew it was time to replace my iPhone back when I was able to interact with the screen out of muscle memory faster then it could process my taps. Literally something in the background running would cause the feedback from typing to hang and then all at once it would pop up.