I cannot see what's written exactly on the DVD box nor the DVD, but they look like official installation material to me. I would back-up my product key using ProduKey just in case (if you don't have it already) and proceed to the reinstallation. And to create a bootable media using a Windows 7 .iso, you will have to download a Windows 7 .iso, which is around 3GB, yes. If possible, can you take more pictures of the box and DVD so I can see exactly what's written on them?
I just verified and in any case, yes, you can perform a clean installation from a Windows 7 Upgrade DVD. Simply insert it in your CD/DVD-ROM, boot from it and it'll launch the installation setup. From there, only follow the instructions of the setup (assisted by my tutorial if needed) and you'll have reinstalled Windows 7 in no time.
Edited by Aura, 13 January 2015 - 12:20 PM.