In Hawaii when I lived there, and even today, seven miles is a long distance. I know, a really different perspective. But to go to the university from that location would be quite a distance, unless they had a car, and it just doesn’t make sense unless they did have a car. The only thing I can think of (and I’m not a researcher, just trying to tag along) would be if they stayed there for a few weeks or something, not really “living” there.
But the fact that the contemporaneous neighbor says she never saw them living next door is pretty good evidence.
We also have Jr’s own words about the short walking tours “...past the private landmarks of a family...” they took while his father was visiting in 1971. Obama Sr was recuperating from a car accident in which he had injured his leg. As a result he was using a cane. It would have been impossible to walk a 14 mile return trip taking this fact into consideration! However, a short trip from the apartment building at S.Beretania St was certainly possible.