I also run the 64-bit version of Windows 7 and downloaded the 32-bit JDK. I had no problems installing the Android SDK and everything works fine. I refused the 64-bit JDK if you do not need it for some reason.
I would look at the answers to the Benefits of the 64-bit Java platform to find out if the 64-bit version suits you. My opinion is that with the 32-bit version you should be fine (in fact, this is more than normal if you no longer receive the error message: P).
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