You realize that you can place your cursor between the URL box and the search box and drag the center divider over to the left if you want it closer. Although on my IE the navigation icons are under the place where the refresh icon is.
IE 7 is installed on my machine. I can’t seem to do what you mentioned. It’s not that important to me anyway. I switched to firefox ages ago. I have even been playing around with google chrome, which isn’t bad.