If you have a legit activation Key that you recieved when you purchased the computer it is completely legal to use a copied disk of the operating system to reinstall windows.
For example- When I first got my E-machines T-2642 it came with windows preinstalled and had a set of window xp home disks and a sticker on the back of the case with the windows activation key.
When the power supply died and killed the motherboard I replaced the motherboard with a different model, the original install disks were setup in a way that they would only install on the original hardware so my original disks were usless but I had technically had already purchased the operating system so what was I to do in the event that I need to reinstall?
Buy another copy of windows?
NO!, screw that.
I had a friend burn me a bootable XP home install disk and used the original key on the back of the case.
In the event that the key doesnt work, phone Microsoft customer support and tell them your activation key is not working and they will give you some weird code to input that will make it work.
Everything here is perfectly legal so long as you are installing the operating system on a single computer belonging to you.