Planeswalker Ability and Death Timing
The dinosaur enters the battlefield as a 5/5 because, as you say, the planeswalker will be dead before the ability resolves. This is the exact sequence of events:


You activate the planeswalker's ability, putting the ability on the stack and removing 7 loyalty counters to pay the ability's cost.
The planeswalker dies as a state-based action because it has no loyalty counters.
All players gain priority, and pass it or respond to the ability.
The ability resolves and the dinosaur enters the battlefield.