No idea what the differences are. GOG only state compatibility for XP and Vista, they do not include Win7. However, many users have got it working under Win7, sometimes with some standard tweaking such as compatibility modes, newer drivers, etc.
What I do know is that the GOG version of MDK1 is the Windows version (Win95 software, D3D, 3DFX) and with no DOS executable. That said, there is a thread that describes the various patches and files you need to obtain to be able to run the DOS version (as the DOS executable can be obtained from official patches) which you can then use with DOSBox. This way you can ensure that you can still play MDK1 in Win7, albeit without the nicer graphics of the Windows versions. I don't know if the Steam version provides the DOS version.