funny, I was thinking of taking off my 7-08 barrel and buying the 260. My 7-08 only shoots -at best - around .80 @ 100. usually 2 touching and one flier. thats with a fresh crown and necksized ammo with benchrest primers and match-quality loading for each round, so I doubt it could be improved much. standard handloads are around 1.5 or more. sure, its a lightweight rifle, but I'd really expect half to 3/4 inch, uniform groups, all things considered.
also, I will say that the 7-08 produces surprisingly hefty recoil in the model 7. I bought it for my daughter, but it proved to be a bit much.