For a secure and fully supported computing experience, it is highly recommended to use a legitimate, licensed version of Windows.
Ethically, the matter is less absolute. Some argue that for abandonware—software no longer sold or supported—activating it without payment causes no direct financial harm to the developer. Microsoft no longer loses a sale if a user activates Windows 7 today because no sale is possible. However, this "abandonware" defense weakens when the tool is used to avoid upgrading to a newer, supported, and still-commercial Windows version. Furthermore, the ethical calculus changes when the loader is applied to copies of Windows 7 used in commercial or enterprise environments, where licensing compliance is a legal obligation.
The tool modifies the partition boot record, which can lead to boot failures or BIOS-related errors on newer hardware.