I have a pretty strict view of this. If one willfully (and/or knowingly) pirated an operating system: they should get no support from the manufacturer at all.
Since unpatched and vulnerable systems can wreak havoc on legitimate customers, I think the best solution is to simply disable the offending product. If you stole the OS, you have no right to use it. Force it to shut down. Don't destroy the drive or any data, just make it the ultimate in nag-ware: continually prompt on boot for a legitimate proof of purchase.
Of course, that gets into all kinds of 'big brother' bull. The end of the story is the same: pay for it. In spite of the fact that the majority of /.-ers think of Microsoft as an evil empire, there are a lot of hard working programmers working for them who do deserve to get paid. The liquid asset of that company is immaterial.
"But what if I'm using it in a lab environment?" Well, you should have paid for your license. Don't want to pay? Microsoft offers 120-day evaluations of many of their products. These are fully functional products and can even be updated in most cases (rare exceptions such as ISA exist).
