I don't think you understand...how difficult it is for someone who doesn't have your system...to take guesses at what's wrong or right with it.
In general, if Windows is successfully activated...it's not an illegal version.
As for hardware problems...I've already given you my main two suspects that I would pursue.
Generally, if you can download and run a diagnostic from the hard drive manufacturer, that should either affirm or refute the status of the hard drive.
Regarding RAM...the way that some of us test it is to run Memtest 86, according to instructions.
These are not the only hardware problem which a system can have, they are just (IMO) the two most common that can be easily checked.
MemTest Manual - http://hcidesign.com/memtest/manual.html
Memtest86.com - Memory Diagnostic - http://www.memtest86.com/
If you have any friends/associates who are (somewhat) knowledgeable about computers...you might consider asking them to take a look at your system.