Hi Alex,
[Alex Petrovitch] “I have a 5.1 mix for a FCP7 project.”
Cool. I assume that by this you mean you have maybe six WAV files, each representing a stem (L, R, C, LFE, Ls, Rs).
[Alex Petrovitch] “I’d like to get it out of FCP7 and onto a bluray.”
Definitely doable.
[Alex Petrovitch] “what should the settings be on the sequence?”
Like this:

Also, make sure that you set each individual track in your sequence to the appropriate output. You can do this in the track panel:

Then, set an in and out point on the sequence.
Now, we’ll do TWO exports. One for video and one for audio.
Video: right-click the sequence and choose Export QuickTime Movie. Current Settings, Video Only, Self-Contained.
Audio: right-click the sequence and choose Export AIFFs. 48kHz, 24-bit, Channel Grouped.
Now you have a MOV file of your sequence and 6 AIFF files for your audio that match exactly in length.
Open Compressor and click the button that says Add Surround Sound. Click each channel and add the AIFF file that corresponds. Then click Add Video and add your MOV.
Now you can add your video and audio compression presets and author Blu-ray straight away.