I have this exact same setup myself now. I leave the 7SC in RGBHV and use a BNC to VGA 15pin breakout cable on the output. I found it to provide a slightly sharper picture than using the VGA 15pin out itself.
Anyway, I have it attached on AV3 and have the OSSC set to passthru for pretty much everything. I also locked the 7sc at 640×480 on its output and the OSSC and my TV do not have any issues with this setup. I only have the DC connected via VGA on the 7sc currently, but I’ve also tested with my Lynx and Game Gear via VGA and they were fine.