you can do it on a different computer and use it on yours.
you really should contact MS before your reinstall windows (that's a pain... cause all your software and everything just don't unless your computer starts crashing randomly)
just call up microsoft. They're networks have been pretty shabby lately. Xbox live windows live have both been showing major problems. There's too much traffic and MS can't handle it. You can keep trying but try doing it late at night.
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