I've been told that in real life, you cant switch between radar modes once a missile has been launched. This isn't implemented in DCS right now but at least in real life, switching to P-STT would not be an option because the missile is tuned to a specific frequency before launch (or something like that).
With that said, when firing AIM-7s, I see no benefit in using PD-STT over P-STT other than a slight increase in range. To me, the risk of being notched and wasting a missile is too big when using PD-STT, so personally I would use P-STT for AIM-7s.
(Also, what's MLC?)