It all depends on the games and what you are doing.
Really the only different between those two CPU's is that one has Hyper Threading and the other doesn't. The i5 has 4 Physical Cores and 1 Virtual Core Per Physical Core. the i7 has 4 Physical Cores and 2 Virtual Cores per Physical so it looks like an 8 core CPU. Now if you are doing things like 3D Rendering, Video Editing etc then yea the i7 is the way to go because those program make use of every one of those cores.
In gaming most games don't use more than 2 cores if that. That is why they say for gaming an i5 is more than enough because games will run better on a PC that has less cores but a higher clock rate where as multi threaded programs will run better on more cores but a...