The Windows 7 anti-piracy update which pirates were fearing is now live getting distributed as KB971033 via Windows Update, the Windows Activation Technologies (WAT) update is tagged important and features detection of more then 70 known Windows 7 activation hacks and cracks informing users of their genuine copy status taking actions if usage of piracy is detected.

However, pirates can still dodge this update by simply not opting to install it or even uninstalling it from Windows Update -> Installed Updates section, they can even restore to a pre-KB971033-update state as Windows creates an automatic restore point before installing updates (seems not to work from user comment below).