When you do a factory reset, the previous "instance" of the phone will still remain in your device list. Do the following:
1. Go to myaccount.google.com, then Security>Manage All Devices, select the entry for your Pixel 7 that corresponds to when you were using the physical SIM, and click Sign Out.
2. Go to the Play Store website (not the app), click your profile pic, then Library & Devices>Devices, and uncheck that previous Pixel 7 listing. Over time, it should disappear from the device list, but in the meantime, if it's unchecked, it won't show up in the device list for installation.