With windows 7, you have to do an inplace upgrade of the OS to 10, which was mentioned and that would convert the PK to windows 10 key. Once that is done you can do a clean install of 10. I agree that the downgrade had something to do with this conundrum.
On windows 8 you can do a straight clean install and no product key is needed.
All this is moot since you given returned the laptops.
This is not entirely true. When Microsoft released the "November Update" they made a change in the install so that you could get your existing key and use that to activate Windows 10 regardless of whether it was a Windows 7 or 8/8.1 key and it would activate once connected to the internet.
Activation now works as it should have originally. When you install Windows 10, you can enter your PC's Windows 7, 8, and 8.1 product key and it should activate properly if that PC was eligible for the upgrade.
The “digital entitlement†process — where your PC activates automatically without entering a product key — is also better explained. Under Settings > Upgrade & security > Activation, you'll now see “Windows 10 on this device is activated with a digital entitlement†if it activated without requiring a product key.
What's New in Windows 10's First Big Update (Which Arrives Today) - How To Geek
Note
Starting with the November update, Windows 10 (Version 1511) can be activated using some Windows 7, Windows 8, and Windows 8.1 product keys. For more info, see the section Activating Windows 10 (Version 1511 or higher) using a Windows 7, Windows 8, or Windows 8.1 product key in this topic.
Activation in Windows 10