I tried phone activation by entering the key, and without telling Microsoft that I used the Dell disk, they knew, and said my friend needed to buy a new license of Windows, or contact the manufacture for recovery disks. it installed, not asking for the product key, and marked it as non-genuine. So, I tried my Dell disk on his system, expecting to have it ask to enter teh product key as the system is not a Dell, and use the one on his laptop. A friend of mine laptop from a different manufacture, needed to re-install his system, and the recovery disk he made ended up being corrupted.
I have a business class laptop, so naturally the manufacture give you, beside a junk free system, but also the OS disk. So for example, in your case, that license of Windows 7, as it is Dell version, will only work on Dell systems. They are special build of the disk by Microsoft, which based on the OEM it is for, it checks the BIOS for a Dell/HP/Lenovo, etc system, If it's wrong, it will be marked as non genuine.