I think Keyclone's solution to the issue of validation is one of the better ways to do it. It is pretty secure, the only way I could think to defeat it would be much more than $20 worth of work (even if you know what you're doing) and couldn't be shared with others. Not going into any more detail for obvious reasons.

A reasonable way to do it without phoning home every time is to phone home the first time to check validity, then hash the unique system ID and store it on the local machine. On subsequent executions, you can hash the system ID again and compare it to the stored value. This could of course be defeated if someone could figure out the hashing algorithm and the algorithm to generate the system ID. Also more than $20 worth of work, but it could be shared and so isn't as secure.

Ultimately, just about any scheme can be defeated, even validating with a server each time (just look at private WoW servers). He is entitled to use whatever scheme he is comfortable with. As many have stated, it's well worth the $20 by itself, and his great support only makes it better. Besides, if you're multiboxing, you can afford a measly one time $20 payment. 8)