Do students at the seven older IITs consider IIT (BHU) Varanasi an IIT?

Your question is outright demeaning the credibility of one of the oldest technical institutions in India. In its initial years, IIT Kanpur was mentored by IIT BHU. considering this do you still think IIT BHU is inferior to other IITs? It has some of the most successful alumni who are contributing largely to the country and raising the flag of the institute high. It is wrong to negate its legacy of excellent and rich heritage just because of the lack of funds it receives. IIT BHU enjoys a good reputation as a part of the IIT family and only 2 kinds of people don't consider it an IIT. Those who go for a less preferred branch in the top IITs and make such comments because of their inferiority complex or those people who speak gibberish about other institutes just to promote their institutes during counseling.

Either way, rather than paying heed to such comments, believe what your heart says and remember every college has its own flaws so it is you to decide which flaw to overlook.