I was unable to run in cmd dmg2iso.
It throws error that it can run only on 32-bit system and not 64-bit.
Is there some free program that can do that on win 7 64-bit?
Yeah, it seems to be a 16-bit EXE dating back to April 2005. As mentioned on its site:
So the solution is to simply use DMG2IMG instead which is still being updated.