Chosen Solution
Replaced cracked screen, now new screen works fine at room temperature but loses touch functionality when cold
Bad replacement screen. Can’t really do much other than try another one. Ifixit does sell replacement screens. iPhone 7 Plus Screen Edit: Thanks whoever added the link to the screen!
Electronic products has a normal operating temperature range, this LCD screen quality may not good lead to can’t work well under low temperature. Contact your customer service to exchange a new product or get an refund.