Yes, 7-Zip is free software. You can use it on any computer. You don't need to register or pay for 7-Zip.
You probably use *.* wildcard. 7-Zip doesn't uses system wildcard mask parser, and 7-Zip doesn't follow that archaic rule, when *.* means any file. 7-Zip treats *.* as any file that have extension. To process all files you must use * wildcard or omit wildcard at all.
Current version of 7-Zip cannot change archive, created with solid option switched on. To update .7z archive you must create and update archive in non-solid mode (-ms=off switch)
Supporting ACE can be implemented, if source code of that format will be available, and if license of source code will allow using that code.