Pretty much that's right, yeah. The i7 has hyperthreading and the i5 doesn't. If we're talking gaming performance, the difference will be very small. But if you do a lot of video encoding or maybe renderings where you need a lot of CPU power then the i7 is very nice. Most people, even the ones who get the i7, don't need the hyperthreading.
The difference between the Intel® Core™ i7-2600K and the Intel Core i5-2500K come down to three differences. The first is the Intel Core i7-2600k has Hyper-threading giving it support for 8 threads to run at the same time. So hyper-threading give you better support for heavy multi-tasking. The Intel Core i7-2600K also runs 100 MHz faster than the Intel Core i5-2500K. The last difference between the Intel Core i7-2600K and the Intel Core i5-2500K has to do with the computational cores for the Intel HD 3000 graphics; the Intel Core i7-2600K has 2 more Execution Cores then the Intel Core i5-2500K.