Are you behind a proxy of any kind that might be preventing online
activation?
Fixed!
I tried manually activating and the following error led to the
solution:
"A problem occurred when Windows tried to Activate. Error Code
0x08007232B" (code = DNS name does not exist.)
I followed step B in the KB below and found my Activation Code wasn't
even close to any MS style key code (4numbers - 3numbers - 6numbers -
3numbers - the numbers and order not even close to my TechNet code - I
don't recall being drunk, what the heck?). I updated the code and
authenticated. Not sure why the incorrect code would return "DNS name
does not exist" ?
http://support.microsoft.com/kb/931276