You can only activate something like 6 devices using the same account. So if you've been using reader for a while and have upgraded your PC/LT/PPC a couple times, you may have reached your limit.
I apparently hit my limit with my Axim. At least I still can read my old books on my PC or LT. But any I buy now can only be read on the ppc OR PC/LT, but not all three as I now have 2 different accounts. Don't even ask me what I think of this.
You can request an extra activation for your account here:
http://das.microsoft.com/activate/en...traDefault.asp
Maybe you'll have better luck than I did. Mine never went through.
Remember, anytime you reformat your hard drive OR hard reset your PPC, it counts as another activation.