Latencies are measure in the number of cycles it takes for the RAM to respond to an instruction.
So that means, if it takes a DDR3 RAM 7 cycles to respond to an instruction, that RAM has a latency of 7.
A DDR2 RAM with a latency of 4 takes 4 cycles to respond to an instruction.
Now, the tricky part is this: how long is a cycle?
A DDR3 RAM running at 1600mhz has a cycle time of 1/1,600,000 sec, which is 0.000000625 seconds. (notice, 6 zeroes)
A DDR2 RAM running at 800mhz has a cycle time of 1/800,000 sec, which is 0.00000125 seconds (notice, 5 zeroes) (which is twice as long).
A simple calculation would show that:
a) for the DDR3 RAM with latency of 7 about 0.000004375 seconds to respond to an instruction; and
b) for the DDR2 RAM with a latency of 4 about 0.000005 seconds to respend to an instruction.
So as you can see, we're dealing with incredibly small numbers here, which is why latencies aren't measured in seconds. However, this does cause problems when less educated people start comparing latencies between different speed RAMs....
I don't claim to be very educated about this, and I'm sure that this is a huge simplification of the whole thing.