Hmm, I don't know if 7 works the same as GM 6.1 but I had a look and I think I worked it out:
all this is a code edit for the Lives object
<Create>
Remove the first line, it isn't needed.
<Draw>
Change it so it looks like below:
draw_sprite(spr_lives,lives,view_xview+0,view_yview+72)
If you can't see it, I changed the -1 for subimg to lives, so the subimg (image 0,1,2,etc) is equal to the amount of lives
hope it helps you!