Drupal - How to solve "This version is not compatible with Drupal 7.x and should be replaced" error?

As per Writing theme .info files, core is a required key. You just need to add

core = 7.x

to make your theme compatible with Drupal 7.

You have to include this:

regions[content] = Content

This is new in Drupal 7, now content is a block.