I have recently bought a new computer. Like you, I will be passing the old one on to a relative. It is my personal choice to play it fairly straight in complying with the licence agreement on purchased software. For this reason I won't be letting the old computer go with the Operating System (or any other software that has an individual key number) that I'm using on the new computer. I'm
giving them the computer afterall, so I won't feel mean for not letting my purchased, mostly registered, software go with it.
I upgraded the OS from W.98SE to XP Pro when I got the new computer anyway. This means the old computer can leave here with a new installation of W.98SE along with disk it was installed from. Presumably you will be getting an Operating System with your new computer so you could perhaps do the same.
There is a lot of free software that you can put on the departing computer to get started with.
Open Office is a free rival to Microsoft Office that works well.
Irfanview is a good image viewer with basic photo editing features, it even has a 'scan and copy' function.
AVG free antivirus software works as well as anything else and
ZoneAlarm provide a free version of their firewall.
In answer to the question about installing software on the new computer: Just install it from the disk you own or the .EXE you downloaded and type in the number you used last time. Before installing, check for any free upgrades. You could wait until the new computer arrives and download any upgrades to that. This will save copying them across from the old one.
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and won't some of these programs know that it has already been registered/installed and refuse to comply with a second time?
It is possible to install key-numbered software on two or more computers without (as far as I know) them being aware of each other via the Internet or any other way. However, if you went through the manufacturers software registration process, you might just have a little niggle that the installations could at sometime tie up in a database, perhaps through both people who have the software asking for technical support or something. I don't know enough in this area to say definitely. The Internet is a good source of information regarding the legalities of this subject.