Did you get all this information from one of those chinese OEM-soft sites? Because it sounds like a lot of nonsense.
Please, do some research first if you're going to attack people and accuse them of talking nonsense in an online forum. As a "Demi-God" you should know better.
OEM is actually just terminology meaning it's marketed towards system builders (let's not forget that technically speaking you can build a system for yourself, thus you are a "system builder", but we'll come to that in a moment), it specifies the general idea of the license but not a license itself.
The key to being legal is following something called a EULA, for End User License Agreement.
The EULA varies from one piece of software to the next. Indeed, some specify that it must be bought at the same time and place as a fully assembled PC, usually the "Manufacturer Specific" versions such as "HP OEM" or "Dell OEM". You also get software such as Nero OEM which specifies that it must be bought with a CD or DVD burner.
But speaking for Microsoft Windows Vista (as mentioned in the OP, thus it is what I'm referring to), it also comes in a generic "System Builder OEM" version which anyone can buy.
I refer you to a few simple articles from reliable sources:
http://www.foxnews.com/story/0,2933,248704,00.html
http://arstechnica.com/news.ars/post/20070130-8730.html
http://www.lockergnome.com/blade/20...lable-for-system-builders-but-theres-a-catch/
And for a more accurate source, Microsoft's own System Builder license agreement:
http://oem.microsoft.com/downloads/Public/sblicense/2007_SB_Licenses/FY07_SB_License_English.pdf
Let's go by that, and first let's define "System Builder".
“System builder” means an original equipment
manufacturer, an assembler, refurbisher, or pre-installer of software on computer systems
This means it can be you, the end user. Microsoft do not recommend it, but it's legal. You can assemble your own computer, or even install Windows on a pre-built computer such as a Mac, and you yourself will be classed as a "System Builder". Microsoft themselves have even confirmed it, as referenced in some of the above articles.
You will probably pick up on point 4.1, and think you have it nailed:
4.1 We grant you a nonexclusive right to distribute an individual software license only with a fully assembled computer
system.
In which case re-read point 1. If the company (such as NewEgg) are supplying the *sealed* software to you, they are not bound to the "System Builder" license. The rules are thus:
If you do not open this package, you may deliver it to another system builder
Older rules said they would have to supply either a "fully assembled computer" or a "non-peripheral component" (such as a stick of RAM) with it, and that if it's a component it would have to be used in the same machine that the license is being bound to. Some companies such as Scan UK still follow this old rule, but they actually removed that requirement when they released Vista.
OK? That's the legalities solved for Newegg and other distributors. We've also established that if you're buying the OEM version of Windows for yourself and you're the one who opens the seal, then you are the system builder. So let's see what your restrictions are.
Re-read the license and you will find... you can install it. There is no restriction at all (apart from the usual software license agreement - you may install only 1 copy yada yada). The restrictions apply if you try to pass on the opened license (at which point you have declared that you are the system builder) to someone else.
That's where restrictions such as point 4.1 come in to play: it means you can't transfer your OEM Windows license to another user unless it is part of a fully assembled system. In short, the license is tied to the computer. If you wanted to sell your PC/Mac on, you'd have to supply the missing parts or remove Windows and remove its license sticker.
Also you can't transfer the OEM license on its own to another individual or another computer.
Nothing unusual there. As you're the system builder, supplying it to yourself, most of it is irrelevant unless you want to sell it on afterwards.
The reason the OEM version is cheaper is that it comes with NO support from Microsoft (the System Builder must provide support - interestingly this means you are legally obliged to provide support for your family if it's a family PC!) and it can't be transferred to another computer, whilst the retail version can. It also doesn't come with the pretty box or the manuals.
Chinese/eBay sellers *are* often illegal because they're selling on Manufacturer Specific OEM version such as Dell OEM which must ONLY be used with a Dell PC. But that's irrelevant to my original point, and anyone who trusts an eBay seller from China is treading on thin ice, IMO.
There, you can't get much better proof than that? If you still don't believe me, ask Microsoft. Unless you can prove better to the contrary (which I think would be a very difficult task) you have no right to tell me I'm talking nonsense.