Not sure whether or not it is set in Vietnam, although there's always a possibility some of it will be.
There's a few interesting little wars around that era that could be used if not Vietnam, particularly if its from an SAS pov.Site wrote:
Tek9.org is quoting Activision sources regarding the new Call of Duty 7, to be released in November, and they are saying it will be set somewhere between WWII and present day.
Of this there should be no doubt. Activision has hinted that it would leave WWII behind months ago. In addition, Infinity Ward (the other CoD develepor) had a contract stipulating that they would create all CoD games set in the modern and post-modern era. Thus, the only thing open to Treyarch would be to settle the game in the post-War era.
In addition to this information, Tek9 states that their sources have confirmed that some missions will be set in Cuba and at least one in South America.
You will apparently be able to play as a member of the SAS (Special Air Service) and one of those missions will take place in London, at the Iranian embassy in the 1980s.
Tek9 has apparently confirmed that Call of Duty 7: Black Ops will feature the zombie mode.
And finally, to no one's surprise, dedicated servers will also be part of the new Call of Duty game -- a fact that can be independently confirmed by BASHandSlash.com.