You’re looking at two headsets in the exact same quality “tier,” so picking the “Best” one is like trying to pick the best slice of tasty bread.
The short answer to your question is that it’s going to come down to your personal tastes. The Cloud Alpha has a slightly more robust bass response and the Arctis 7 has a stronger focus on treble.
Rtings has measured both of these headsets and that should give you a rough idea of their sound signatures. But you won’t know if you like them until you listen to them for yourself!
Headphones - 1.2 - Graph
Wireless Earbuds Wireless Bluetooth Noise Cancelling Running Earbuds And In-Ears Gaming Xbox One PS4 True Wireless…
If you look at that link you’ll notice their sound signatures are both incredibly similar, and I can’t tell you what your personal preferences are.
Driver size doesn’t have as much of an impact as marketing departments would like you to think. It’s one part of a headphones overall audio design, but it’s an easy thing to put on a box and hype up. Pad shape/material, cup design, damping materials, driver materials, size of magnet/coil, and the foam used in front of the driver all also have a big impact on the sound.
It’s a holistic process to design a headphone, but often it’s easier to just say “Look a ‘big’ speaker” when marketing them.
As far as non sound signature- related stuff, the Arctis 7 is more breathable but isolates a little less well, but I think they’re both in the same comfort range. The Arctis 7 also offers the big added benefit of wireless connectivity.
7.1 typically works by taking surround data from your game and processing it with special algorithms to create binaural audio that’s then played back through headphones. Most of these systems are either loved or hated by their users, and again, it’s down to your personal tastes and how well the algorithms used suit your particular ears.
You’re right that the Cloud II’s surround system is poor. It doesn’t even use the 7.1 channel data from the game, instead taking standard stereo information and expanding it outwards, awkwardly.
I would probably personally lean towards the Arctis 7, because of its wireless functionality and the fact that DTS Headphone X is a fun extra. I like a little treble emphasis for gaming, especially for positional/footsteps awareness, and their suspension headband system is very soft on my big head.
You could always use Windows Sonic with the Arctis 7 as well, if you wanted to.
However, if you love bass impact and need the isolation that HyperX’s soft leatherette would provide, I would never talk you out of the Alpha. It’s a great product, and if those were your tastes it would suit you better.
Maybe try flipping a coin. :)