If I were your friend, I would ask about the below quote from the below article. Sounds like he is being snowed on the phone. Let us know what happens.

"Activation is anonymous, and no personal information is required to activate. The installation ID records an association of the product ID to your computer and a confirmation is sent back to Microsoft. You can then use the product key to install Windows on that computer an unlimited number of times. However, if you need to install Windows on a different computer with that product key, you might need to contact a Microsoft customer service representative."

from here:
<a href="http://support.microsoft.com/default.aspx?scid=kb;EN-US;Q307890" target="_blank">HOW TO: Activate Windows XP (Q307890)</a>