I need cpu help?

heres the deal. I have a dell with a pent. 2 processor. I had windows ME. A "friend" gave me a copy of windows XP, a burned copy. afterwards my cpu was full of viruses . soon after i got that under control with AVG. I upgraded in to I. Explorer 7. Now heres the issue. afterwards its telling me that I recieved a counterfeit copy of windows. I think im gettin locked outta my cpu in 30 days. thats all microsoft sponsors apparently. I tried downgrading to XP home instead of Pro but wont let me install a older version of windows. idk how to downgrade and uninstall windows xp and put in xp home. Is there anyone out there who knows how to help i dont wanna lose my computer. but it seems im screwed. help would be GREATLY appriciated.