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It sounds/looks like it's telling you that the key you're trying to use is already in use. I'm not "saying" anything, but if your copy is really legit and you're having this issue, call MS and they will reset your key. It's a PITA that will take 30 minutes of your time, but it will work.
 
When you activate online, it checks your key against MS's database for:

Valid Key
Key in use?

They will reset your key/and or give you a new one.
 
There's usually an option that says "enter a new/different key" and then you can change the key. It may be hidden in there somewhere, I don't recall the exact location.
 
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