you must have said something wrong.....or the key was entered incorrectly.
In hundreds of activations I've never been escalated. Never. Its worked every time
Give it another go using the automated line, check the key very carefully, and make sure you answer the automated questions correctly. When it asks on how many PCs the software is installed, be certain to say "one" only.
Other possibility is that the installation CD is for the wrong version of windows....
what does the CofA sticker say re version? And whats on the disk? Is it a genuine Microsoft disk? Or an OEM manufacturers disk?