If you have the genuine Canon AC adaptor please test it.
(Mine is a cheap one (~12 bucks) and it has no chip. I wonder if the most expensive Canon has the chip or not.)
Yup, I have one of those cheap adaptors too. I tested it in the grip+a chipped battery and it didn't work. My cheap adapter has the same connectors as the genuine adapter but it must have a similar chip as the batteries.
There is a workaround if you have a battery grip.
1. Insert chipped battery in the right side compartment and leave the battery compartment open.
2. Turn on camera and flash ML.
3. With camera still on, insert AC adapter in left compartment.
4. (optional) remove chipped battery.
5. Close grip battery compartment.
Once that's done, mine shows both batteries as having bad battery life and only a percentage of battery power, but the top LCD on the 7D shows full battery power.
Try at your own risk. I haven't done any extensive tests. I just know that it works that way.