There are many alternatives- no easy solution though.
Most commonly used with peltiers and water chillers is a combination of conformal spray coating (insulating the back of the mobo and sometimes selected areas of the front), neoprene insulation (waterblock and socket ) and pipe/tube insulation for the coolant lines.
The idea behind this is to insulate all areas where the extremely cooled materials (tubing, block or mobo) are exposed to air.
If the air can't reach it, no condensation forms.
I have seen people use dessicant materials of many different forms to supplement all the insulation but I have never seen anyone use silica INSTEAD of insulation.
I am NOT saying that it cannot work- although I am highly doubtful- I do not know anywhere near enough about dessicants and dewpoint to make a statement like that.
But I would love to see a write up of someone trying to use a chilled block with only dessicant in the case to prevent condensation.
Edit: to add a note about water cooling-
A standard water cooling setup will NOT attain temps of -7c.
To get temps in that range you need pelts chillers or some other form of refrigeration, period.
The best non-chilled systems are bongs and on a good day they cab get a few degrees below ambient at best.