I have a discussion with my friend about windows activation.
Statement 1
Windows activation is always same on the same hardware, meaning you can reactivate windows license unlimited number of times on the same computer
Statement 2
Windows license is valid only for the current windows installation. If you reinstall the windows, you will need to reactivate again your license, and you cannot do that unlimited number of times on the same hardware.
Which is correct?
Windows licence is linked to the PC. After about 3 activations you would be transferred to the MS agent and you have to give some explanation. So Statement 1 is correct. That is if you have the same harddisk, motherboard etc ....
If the hardware stays the same and you reinstall the same PC you would be allowed to activate ... So statement 2 can also be true...
It varies based on the exact product, terratory and licence agreement you have in place. For instance it's a very different scenario if you're a home user or if you're a corporate user. Best speak to MS with exact details to find out you own answer.
You can make statement 1 always true if you preserve the file that holds the activation data:
How to Reinstall Windows XP Without Having to Reactivate With Microsoft
Note that this is a "legal" hack, IIRC I read about it in the blog of a MS employee.