Allow me to point out that 3/2 ^ 12 is not exactly equal to 2^7. What this means is that twelve fifths is not quite equal to seven octaves (In fact, it's a little higher). In other words, the problem is not some basic misunderstanding of the physics of music, nor is there an error in music theory. Essentially, the problem exists because that's just how things are. While seven and twelve are nice numbers, this time things just happen to not work out.