Windows Activation Problem

Do two further things - first move the two files that hold activation
info to some place else; they are windows\system32\wpa.dbl and wpa.bak

Then run regedit.exe, open to
HKEY LOCAL MACHINE\SOFTWARE\Microsoft\WindowsNT
       \CurrentVersion\WPAEvents
and in the right pane double click OOBETimer and *change* the first byte
to 00

With those two dlls re-registered this should allow you to run
Start - All Programs - Accessories - System Tools - Activate Windows

Start on Activate by phone - this gives an opportunity to change the
Product key; use it to ensure that the one in use is the correct one and
not some bastardised one supplied by your *friend*.  Then cancel before
the actual call, reboot and you should be able to run the wizard again
and activate on the net

If that does not do it, you may have to do a complete format and
re-install - and charge your *friend* for the cost of the disruption