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calibre turns tags into collections. That has always been the case. You can turn off that behavior by going to Preferences->Plugins->Device interface plugins and customizing the SONY plugin to not use tags to create collections.
The only difference in 0.7 is that calibre automatically recognizes books on your device that are also in your library and updates their metadata. Most people would consider that a good thing.
I've even added a note about that in the what's new page under Incompatible changes
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