W10 upgrade error

Solution
You're supposed to do exactly what you're doing, but since it doesn't work, you got a bad key - plain and simple.

Ask for a refund from the seller and save for a real key from Microsoft.
I agree with ThatVietGuy, this is disreputable seller. Likely he got his hands on one key and is selling it to multiple people. It might even be a generic OEM key that has multiple activation's, but it has run out of its quota. Either way, I would get my money back if possible. Also keep an eye on your credit card activity.