All depends on how large of a system........
Anything under 60 gallons total volume I would say to use it external if you are really worried about heat. Any larger volume (Tank+Sump) I wouldnt worry at all. Submerged does keep the pump cooler. And mag 7's are not very large to begin with.
JMO
Although Mag Drive pumps can be external pumps, I wouldn't recommend it. There are better pumps you should look into. I have the Mag 7 and my 29g and my temp in the tank holds at 80.4 with lights on.