That being said, you can upgrade just about every other component in the system, and you'll be ok in terms of the license.
What is the difference between the OEM, and the Retail version of Windows 7?
There are 3 major differences between these 2 items. The physical DVD disks themselves contain exactly the same content.
1. OEM copies of Windows 7 come in either 32, or 64 bit flavors. You must decide which version you want, and make sure you purchase that copy. With a retail copy, you get both 32 and 64 bit Windows Vista DVD’s in the same box.
2. OEM copies cannot be transferred from one PC to another. Once you install an OEM copy of Windows Vista on a PC it must remain with that PC forever, unless upgraded to a newer version of Windows in the future. Retail versions can be moved from PC to PC, but your retail copy of Windows 7 cannot be installed on more than one PC at any given time.
3. OEM copies do not come with any support from Microsoft. If you need to call Microsoft for support with Windows 7, you must pay a fee to do so. Retail copies come with a phone support incident included in the price.