How exactly is the encrpytion used?
The exact workings are probably a secret. My guess is that it uses standard symmetric key encryption technologies, with the key being provided by the publisher when the product is activated.
What parties are involved when a game needs to be activated?
The answer to that question can be found in this spiffy diagram.
When is a game in need of a reactivation?
The article you linked to answers that question:
When a player runs the game for the first time, the Goo’d program lets the user enter in their email address and serial number which associates their game to that person as opposed to a piece of hardware like most activation systems do. Once validated, the game never needs to connect to the Internet again.
How are illegitimate users locked out?
The article you linked to answers that question:
When a player runs the game for the first time, the Goo’d program lets the user enter in their email address and serial number which associates their game to that person as opposed to a piece of hardware like most activation systems do. Once validated, the game never needs to connect to the Internet again.
What happens if stardock goes belly up and a game needs to be activated?
Nothing, as indicated in this spiffy diagram.
What restrictions are there on activation?
You have to have an email address and a serial nimber, as indicated by the article you linked to:
When a player runs the game for the first time, the Goo’d program lets the user enter in their email address and serial number which associates their game to that person as opposed to a piece of hardware like most activation systems do. Once validated, the game never needs to connect to the Internet again.
How would you activate without a network?
You won't.
Although if I remember correctly, they will be allowing you to do so at another computer. I don't have the time to look up where they said that at the moment, though.
Can a user obtain the plain installation file of the game that is not Goo encumbered?
Only if the publisher allows it.
How does Goo ensure that after the expirey of the copyright on a game the game can enter the public domain?
The publisher can always re-release the game without GOO.
How does Goo ensure that libraries can lend copies of Goo encumbered games?
The libraries can simply contact the publisher.
I don't know of any libraries that keep catalogs of games. Could you point out for me one?