Early indications are that "Adobe Air" and/or "Acrobat.com" are breaking the display in browser function in Windows 7 Beta when using Adobe Reader 9.
On a fresh install of Windows 7 Beta, I installed Adobe Reader 9, and as everyone is finding out, you cannot display a pdf in a browser window. Doesn't matter which browser either. IE8, Opera 10a, Mozilla SeaMonkey 1.1.14 had the same result for me. The only workable option was to have the pdf open in a separate window of Adobe Reader itself. Oddly though, on rare occasions I could get a pdf to display in a browser window, but 95% of the time it would not work.
On another fresh install of Windows 7 Beta, I installed Adobe Reader 9. After installation I opened Adobe Reader and accepted the license agreement, then closed Adobe Reader. Next I uninstalled "Acrobat.com", then uninstalled "Adobe Air" using Programs and Features in Control Panel. So far, I have not had any problem downloading and viewing pdf's in a browser window. Tested with IE8 and Opera 10a. Note that I did not run compatibility mode on Adobe Reader.