The export to 3D DWF files have changed in AutoCAD 2007 compared to 3DDWFPUBLISH that was in AutoCAD 2006.
Use File>Export or click on the 3DDWF button
on the Standard toolbar.
In the Export Data dialog box, specify a name and location for the DWF file.
Click the Tools button at the upper right and select Options.
In the 3D DWF Publish dialog box, click Selected model space
objects and then click the Select Objects button.
In the model, select the objects that you want to publish.
Bug note! Here is something you should be aware of. If you have blocks or external references there are some things that doesn't act as they should do. If you select block or xref it looks like it is completely selected but in reality it is only the object within that will be exported. It works to use "all" as a way to select everything in the drawing and then if you want to remove objects it doesn't work as expected either.