I do not think you need a raspberry pi. The ov7670 can output a 40x30 image which fits in ram.
40x30x2=2400 and you have 2.5kb of ram.http://forum.arduino.cc/index.php?topic=159557.0
Or you could use a higher resolution and just read what you want. Or you could configure the output window.
Another option is to use external spi ram or use the fifo version. However if you don't want any of that it may still be doable.
Also the sparkfun product is jpeg. How are you going to decode that in real time on the arduino for color tracking?