This means that recovery doesn't recognize the Google Drive APK inside the update package. Most ROMs don't come with Google Drive pre-installed, so I assume you're trying to use a factory image, which needs to be decompressed and flashed via fastboot. Factory images cannot be installed via recovery.
First, you'll need the Android SDK. Here is a link to get that: http://developer.android.com/sdk/index.html
Next, you'll need to unlock the bootloader. Power down your Nexus 7 and then hold power + volume down until it boots into fastboot mode. Now connect your Nexus 7 to your computer via USB, open a command terminal and type
fastboot devices, and hit enter. If your computer recognizes the device, the terminal will output the serial number and fastboot.
The next step will wipe all data off of the device. If that's ok, continue.
Now, type in
fastboot oem unlock and hit enter. The device will prompt you to confirm the bootloader unlock. Follow the instructions on the Nexus 7 to unlock the bootloader. When finished, the terminal will display a success message. After this is complete, type
fastboot reboot-bootloader and hit enter to refresh the bootloader.
Now, move the image zip to the
platform-tools folder of the Android SDK and unpack the factory image on your computer using whatever zip tool you have available. There is a second zip file inside the package, be sure to unzip that also. then, in the terminal, navigate to the unzipped factory image folder and type
./flash-all.sh (OSX/Linux) or
flash-all.bat (Windows) depending on your computer's operating system.
Let it do its thing and the device should boot into the OS when it's done.