Unable to install Windows 7

I just purchased an IMac i5 along with Parallels 5. The computer has 1 tetrabit of storage and 4 GB of RAM.
I have upgraded to Version 6.
I can install Parallels.
I cannot install Windows 7, 64 bit.
The message in the Windows screen is "to use the product key you entered start the installation on a computer that is running a genuine version of Windows."
In fact, the machine freezes and I have to reboot.
The copy of Windows 7, 64 bit was purchased through the educational route. I am an educator.
This is a new copy of Windows. In fact, the University only allows one copy person for one computer.
I planned to transfer files from my PC that is XP based to the Mac with Windows 7.
After this experience, I figure that the copy that I have is an upgrade copy. This is my surmise although I started out with the idea it was a full copy. You can help me understand this.
But please tell me how to proceed.
Am I out of luck with the Windows copy.
Do I need to buy a full copy of Windows?
Can I upgrade my PC with this copy and then use this copy with Parallels?
Look forward to your wisdom.

 

Worked out problem

I have an upgrade version of Windows 7 that I purchased from the university.
Da.
Will use my XP disk from my Dell for the virtual Windows on the Mac with Parallels and then upgrade to Windows 7 on the virtual disk.
Steve

 

Where is the reponse to this concern!

I have the same problem. The aforementioned fella and I cannot be unique in our Windoze installation travails. Where is the tech support response? After two years no less? -E