99 % of people didn’t “upgrade windows” back then. That would have required buying a whole new, full-price, license (or pirating). Even Service Packs were a whole deal to install. In those days you’d use your OEM Windows license the computer came with and that’d be that.

What did actually happen was OEMs selling millions of brand new shitbuckets, particularly laptops, with 1GB of RAM. That was fine on XP, but barely enough to boot Vista and if you stared any program it would swap like a motherfucker (sure, maybe it should have used less memory, but 7 wasn’t any better yet people were fine with it). Microsoft’s real mistake was allowing OEMs to sell new machines with 1 GB of RAM (IDK if it was to allow OEMs to install Vista on existing SKUs, but regardless it was the critical mistake that made everyone despise Vista).