As I wrote many times, Windows 7 (and Windows Vista before) is incredibly popular software, which is the fact. But I think Microsoft deliberately makes it available for crackers in a very hidden way. By doing this, Microsoft can kill two birds with one shot: people who buy software and the ones who don’t — both run the latest superior operating system — Windows 7. My point — one population will never merge with another one completely, so if you really restrict the illegal use, you will loose the other half. You’re only interested when everybody is using your software, because then there will be no real alternative. Linux? It is a free headache in short. Apple? That is a good example of those who want to exclude the dark side. Pirated Leopard is a very rare animal. Result? Look at their market share. Microsoft makes it in a very wise way: they say they fight piracy and they do, but in reality they leave back door open. So, you could ask: Well, how about that activation stuff and genuine software program? That really works, however the workaround is very simple.
The idea has become possible due to specific OEM activation mechanism (SLP): If the OS can match three things together (OEM information in SLIC table from BIOS + digital certificate (file) + product number), then the activation happens automatically and instantly. The first part is the most tricky one, because it is hardware driven, i.e. depends on PC manufacturer, all the rest can be simply copied, given the System Locked Preinstallation keys are common for one OEM (ASUS could use one product key for many-many computers, for instance). So what hackers did, they introduced a program loader that puts appropriate OEM info into memory before Windows boots.
Here is a very good explanation of the method, ironically called The Official Windows 7 Repository. Let me quote: “Activators, also known as loaders, add a script on the boot partition (Linux Grub boot loader (GRLDR)) which will put OEM information (SLIC 2.1) into memory before Windows starts. This way Windows thinks that the SLIC 2.1 come from the BIOS (which is false). Activators also install a certificate and an OEM SLP key to activate Windows”.
Windows Loader by Daz is the most popular activator which is kept steadily updated (last version is 1.9.2)