At what camera settings or picture size should we use in order to fill up the rMBP's screen when viewing in full mode? Right now, I am seeing black horizontal bars on the side.
If that's what you're worrying about - the rMBP is 16:10 and your camera is 4:3. Check out the ratios on your camera, however it would probably be wiser to capture at full 4:3 then crop if you need a full screen image.
Really, *horizontal* bars? The standard aspect ratio used by DSLRs like the D-7000 is 3:2. This goes back to 35mm film which has an image size of 36mm x 24mm. That aspect ratio should give you *vertical* bars on the rMBP's 16:10 display. When shooting video with the D-7000, you will get a 16:9 aspect ratio which will give you horizontal bars.
My point-and-shoot camera allows me to select from a couple of aspect ratios, but my understanding is that the D7000 only shoots stills in 3:2. However, in the "retouch" menu you can alter the aspect ratio after the photos are taken. The camera can crop to an aspect ratio of 3:2, 4:3, 5:4, 1:1, or 16:9. None of these will perfectly fill the rMBP's 16:10 screen.