I was in a similar situation. I had "Windows 7 Home Prem OA HP" on a HP desktop I bought new and then upgraded the system to Ultimate with an Upgrade key. But now that I bought a refurb desktop with no OS (with a COA for "Windows Vista Business OEMAc") I needed to use that Ultimate license on the "new" refurb desktop. So my "downgrade ultimate to home premium" search brought me here, amongst other places.
I used the registry solution explained here, manually and without the use of a popular tool from a website called deviantart. I figured I was better off hacking the puter manually myself. I did however used it this way (notice upper & lower case matching the "Ultimate" entry format):
EditionID "Ultimate" changed to "HomePremium"
ProductName "Windows 7 Ultimate" changed to "Windows 7 HomePremium"
For reference, I also used the following posting on tomshardware (www.tomshardware.com/forum/13130-63-downgrading-win7-home-premium), specially the response by aquasystems.
Then, I needed to do the "in-place repair upgrade." I tried using the windows 7 repair disk I had originally made with the HP desktop only to realize that it was not what I needed. What I needed was a Windows 7 Home Premium 64-bit installation disk. Since I was afraid to use the system recovery disks of the hp desktop (who knows, it might have worked but I did not want to risk a complete recovery), I downloaded an iso image from digitalriver. For that I followed the advice and links I found on a microsoft community post (://answers.microsoft.com/en-us/windows/forum/windows_7-windows_install/can-i-downgrade-from-windows-7-ultimate-to-home/ca6cda9a-3c44-40aa-880f-45b12947a880). I burned the iso image to a dvd using imgburn.
To do the "in-place repair upgrade" I used the DVD I had made, pop it into the dvd drive and allowed autorun to start the process (you can navigate to the dvd and double click setup.exe if necessary). I then followed the process as presented by unawave (www.unawave.de/installation/downgrade-en.html?lang=EN) and here, although the german screen shot is just superfluous. This was a very good step by step site that helped me. I did not get a compatability report about the languages pack; only a small warning that the system needed rebooting before runing setup.exe (which I did before running setup.exe a second time). After the second time running setup.exe, then the rest of the process went as planned. When I was done, I was able to confirm that the windows version had been downgraded to Home Premium.
But, a brief warning about activation of the product key. Once I "downgraded" I needed to re-activate my Home Premium key (stuck on the side of the HP desktop). When I tried activating it, the system responded that it was invalid and that I could not activate it online and needed to do a phone activation process to get an confirmation id. I figured, I was already done with the deed and since I legally owned the license (aka product key) I had nothing to loose. The pop-up warning window asked me to call a toll free number and follow instructions. The call was answered by an automated system which asked me to enter on the phone a total of nine six-digit number groups which were displayed on the pop-up instructions. After this, the automated response indicated that my activation was valid and that I needed to enter eight six-digit number groups (A through H) it would give me to put in their corresponding spaces on the pop-up instructions window (see ://img.technospot.net/windows-7-activation-screen.png). The automated system allows for all the number groups to be repeated to verify they are entered correctly. I completed the phone verification process and there it was ... the install was activated and fully functioning as it used to be. So, this was a successful "in-place repair upgrade" downgrade from Windows 7 Ultimate to Windows 7 Home Premium (HP original install).
My thanks go to everyone who contributed in this thread on this page. Also, my thanks go to the following websites and postings which also helped me to do this. Mind you, I used the advice in all of them as advice only and did not follow anyone's instructions blindly or uniquely. Always do your homework before undertaking tinkering such as this ... and of course, always backup backup backup