We present calculations of the small-signal gain coefficient, gain length, and output energy of a recombination laser in Ar7+ driven by optical field ionization. Simulations are presented for both 400 and 800 nm pump radiation, and for two targets containing mixtures of argon and hydrogen: a gas cell, and a gas-filled capillary discharge waveguide. Extremely high values for the small-signal gain coefficient are calculated for the 4s-3p transition at 23.2 nm using a pump wavelength of 400 nm for both the gas cell and waveguide. Operation in the waveguide is predicted to greatly increase the XUV laser output owing to a large increase of the gain length. The calculations also show that use of the waveguide allows significant single-pass gain to be achieved even with pump radiation of 800 nm wavelength.