The vast majority of cheap Win 7 keys are Technet keys. Technet was a program Microsoft ran for software techies and resellers, so we could try out their software and learn its ins and outs so we could provide better support and make better recommendations to customers. Depending on your subscription level, you got 2 or 10 keys to almost every Microsoft product. Many unscrupulous individuals got TechNet accounts, and began selling their keys on eBay and via websites.
The keys are legit and "permanent". But there's a huge caveat. Microsoft shut down the TechNet program last year because of rampant key abuse. If they detect a TechNet key being used too many times, they will invalidate every key given to that TechNet account. So if the guy you're buying the key from sells any of his keys (not just the one you bought) to more than 2 or 10 people, or if one of the people he sells a key to spreads that key around on pirate sites, your key will work fine until one day when it suddenly becomes invalid.
That happened to a friend of mine. One day Windows complained his copy of Win7 Ult was counterfeit, and nothing he tried, even a reinstall, would make it a valid key again. And since you can't downgrade Windows versions, he ended up having to buy a new, legit copy of Windows 7 Ultimate. In other words, he ended up paying more than if he'd just bought a legit copy in the first place.