Yes, you can reformat. Under Vista, I progressively
(a) restored a drive image of the OS to a new HD. This required manual activation through Microsoft. When I did that, I asked what would happen if/when I took my next steps to resolve the issues I was having. They said "NP".
(b) I then replaced the motherboard, This again required manual activation that went without a hitch, as they promised.
If you have the actual OS disk, you will have no problems with a simple reformat or more.
If you have a "restore disk" from the PC vendor, you may have problems doing more than a simple reformat.