As I already wrote, you don't need to install Win 7 on the new drive just to create the EFI and the MSR partition.
You can create both with diskpart...
My preferred strategy is to activate early in the rebuild process. No sense wasting your time with the rest if the activation process turns out to be...
Router / modem shouldnt be the problem because rest of the devices connected to network work just fine ( both trough cable and wifi), this errors are...
Understood about disconnecting bootable drives, I got caught probably 15 or more years ago once, with another bootable drive connected and it messed...