>The most fameous being the guy whose XP on his laptop suddenly disabled while he was using Word at 30,000 feet on flight to a business meeting.

Something about the laptop going into reduced mode that fired it. Thats sort of a strange one, I know the PA people at MS figured out what was happening though.

>THen there are the stories coming out of Austrialia, where MS tested the wizard.

Didn't hear about those, any info?

>They may get the bugs worked out, but when ever you change your hardware configuration (upgrade, repairs, etc...) there is a strong possibility you will have to convince some clerk in Redmond that you aren't a pirate but are merely trying to get your legal copy of running again.

I woudln't say strong.
http://www.microsoft.com/piracy/basics/activation/windowsproductactivationtechnicalmarketbulletin.doc

Check out the scenarios in the middle of the doc.

Scenario A:
PC One has the full assortment of hardware components listed in Table 1 above. User swaps the motherboard and CPU chip for an upgraded one, swaps the video adapter, adds a second hard drive for additional storage, doubles the amount of RAM, and swaps the CD ROM drive for a faster one.

Result: Reactivation is NOT required.

Scenario B:
PC Two has the full assortment of hardware components listed in Table 1 except that it has no network adapter. User doubles the amount of RAM, swaps the video card and the SCSI controller.

Result: Reactivation is NOT required.