Confused how you get from step 1 to step 2
I don't understand how you get the -7 from x^2-2x
Ok. That makes more sense now. Your first step is fine, although I would probably leave the 7 on the RHS. Different people complete the square in different ways.
$\displaystyle x^{2}-2x=7$. I pulled the 2x over to the LHS.
$\displaystyle x^{2}-2x+1=7+1$. I added the square of half the coefficient of the x term to both sides. Then you get
$\displaystyle (x-1)^{2}=8$. From here, it looks as though you've solved the rest of the problem.