CLR Im not doubting you and I have realized recently that I have a lot more to learn about Microsoft licensing, so please don't take this as I am questioning your knowledge just seeking clarification. Are you saying that if I have an OEM disk for Windows XP, and I have a desktop that came with an OEM copy and has the COA on the side that its illegal (by Microsofts standards) to use that OEM disk and the original key on the COA? I mean that sounds perfectly plausible they way some of the other licensing stuff works it just doesn't make sense. Why do they care what disk is used as long as its a valid code?

I keep an OEM disk around specifically for this reason. Same way I keep a Dell restore CD for XP SP2 and Windows Vista. For a lot of my business customers after some time its easier to reinstall Windows than attempt to clean up all the junk they have installed and removed on their computer. I have been using my OEM disk and their original COA key.