And how big are files inside this archive? Which dictionary size was used to create archive?
It was a random file that i found on google to test the port. I remember that there was just one file of about 38MB and the compression method was PPMD.
Does Xad's 7z can unpack the archive?
No, i have just checked it. It complains about memory too. So, it's the insane memory requirments of the 7zip to blame, not your port.