Does the dongle have Windows 7 drivers? Check in device manager see if it's listed there with any errors. Try a different USB port also. If none of that shows or does anything, try it with another PC. If that does not work, replace it.
So when you said nothing was showing up, you were not talking about the WiFi dongle but the wireless network list? From what you wrote it sounded like the WiFi adapter was not showing up on the computer.