I think most HP have a built in recovery partition whereby you hit a specific Fn key on booting to enable a factory restore, that is the simplest method if available.
I've had a trashed hard drive on one before and used a generic Windows 7 iso to make a USB install (Microsoft has tools to make a bootable Windows 7 USB stick). I've used the key from the netbook sticker to activate ok (the sticker was very well hidden, had to take the back of it!)
The link below will give you an overview. I've used a little util called ABR to backup the keys for Vista and I guess 7, saved to a stick and reinstall afterwards. Shouldn't be needed though as you have the COA key so should activate OK.