7100/year in returns today is what you get from 100k invested (after adjusting for inflation) on a 7% index return (ok, 7.1%). That's nothing remotely similar to a 20k check (throwing off 1420/yr). They wouldn't make the offer if they didn't get money out of it.
If the pension were fixed at 7100 when you retire, I'd say take the check and you'll beat it in an index fund. If you're saying it continues to grow, it would have to grow at about 1.5% to be worth less than the check, if you invested for 7% inflation-adjusted returns on a good investment of the check.
What is the annuity's growth rate?
Annuity growth rate > 1.5% and the pension is worth more. >3.5% and I would totally keep it, especially if you have significant other investments (290k value from 3.5% growth vs 160k at 7% from check)
Annuity growth rate < 1.5%? I would take the money and invest it better than the pension fund will, but roll it out of a 401k if that 401k sucked.