7000 rpm is nothing on a test rig, as this is at the alternator, whose pulley is around half the size of the crank pulley, so will be roughly double what the engine is doing anyway.
Sounds like a dicky rec/reg in the alternator, odd but does happen.
For the gauges I would have a bloody good wiggle test, hopefully find a broken connection, also look on the rear of the instruments as the tracks sometimes break, I've soldered joins in a few before now, check your supply at the plug to the gauges, make sure all that is correct.
tabetha