The FAQ says:
Can I use the EXE or DLL files from 7-Zip in a Commercial Application?
Yes, but you are required to specify in your documentation (1) that you used parts of the 7-Zip program, (2) that 7-Zip is licensed under the GNU LGPL license and (3) you must give a link to www.7-zip.org, where the source code can be found.
But LGPL v2.1 seems to indicate in section 4:
You may copy and distribute the Library (or a portion or derivative of it, under Section 2) in object code or executable form under the terms of Sections 1 and 2 above provided that you accompany it with the complete corresponding machine-readable source code, which must be distributed under the terms of Sections 1 and 2 above on a medium customarily used for software interchange.
The LGPL v2.1 seems to indicate that if I distribute 7-zip (say, an exe file) I must also distribute the source code next to it. Simply pointing to the 7-zip web site doesn't appear to be allowed.
1) Am I reading this correctly (I'm not a lawyer)?
2) Can the license can be modified (a codicil?) to say that the option in the FAQ is sufficient for an "unmodified" release of 7-zip?
3) Am I paranoid (probably!)?
The main thing - all users must have access to source code.
While 7-Zip site and sourceforge provide source code, it's enough to link them.
In paranoid case you can include 3 links:
1) to 7-zip.org site
2) to sf.net site
3) to some your site, where you can provide same source code.