Copying a site to a multi-site installation
How can I confiure it so it works on / rather than on /drupal7


This has to do with your Apache VirtualHost. It probably is pointing to /usr/share/ instead of to /usr/share/drupal7. So in order to access the content in the drupal7 folder, you need to add the folder to the url.


  Question 2: How can I fix the 404 error?


Relating to:


  But if I go to e.g. www.foo.com/drupal7/members I get: 404: The requested URL /usr/share/drupal7/index.php was not found on this server.


The first thing is figuring out if there is an index.php file there. If so, does it have the correct permissions?

It seems to be an Apache error, not a Drupal error at this point. ;)