Can anyone else please check your "Date & time" real quick, and confirm if you have a "Automatic time zone" option on your Nexus 7 or not? Thanks!
On my Nexus 7, in the "Date & time" section of the Settings app, I only have "Automatic date & time" at the top. But on my phone I have both "Automatic date & time" and "Automatic time zone". I'm currently running stock 4.2 (rooted) if that makes a difference.