Microsoft's activation practices are shady at best.
A few years back when Windows 7 came out, I bought two of the Windows Home Premium 3 pack upgrade disks for use on 6 total PCs.
I have 5 pcs in my house, but, over the years, due to virus issues, hard drive failures, etc, have had to reinstall the software.
I bought a new hard drive to replace one that had developed bad sectors. It was my os drive on my media center. I reinstalled Windows 7 (the upgrade), but of course can't activate it. I called into MS to see how I'm supposed to activate this because originally I had upgraded XP to Windows 7, but with a bad hard drive, I can't do that anymore. They told me for both of my keys, I had activated well beyond the limit. 5 on one and 8 on the other. I countered with the statement that I only have 5 pcs, but sure, I've activated it numerous times on the same PC for various issues. Besides, the box and disc say its for use on up to 3 pcs per license, not 3 activations.
At any rate, MS can't help me and I'm hosed as I couldn't activate this install even though I own the software and originally had XP on my OS disc. I wasted over an hour talking to people who did not have English as their primary language and who were hard to understand and not helpful at all.
Eventually, I was given a workaround on another tech site that worked for me.
open regedit, search for "MediaBootInstall", change from 1 to 0, close regedit.
open an elevated command prompt, type "slmgr /rearm".
reboot
Now your install will take an upgrade key.
But personally, I think that's total BS that they say 5 and 8 activations is too much. The family packs are retail licenses, and can be moved between machines.