Yes an activation can be 'backed up' but in my experience it doesn't work.
Well i've never got it to work, anyway.
The procedure is relatively simply:
Open Windows explorer and navigate to C:\WINDOWS\System32 (If you dual boot
you will need to replace the C: option with the drive letter of the
operating system you are using). Now locate the following files: wpa.dbl and
wpa.bak. Back these files up to a floppy or cd and keep them safe.
When you re-install XP again, after installation, close down and then boot
into Safe Mode. Once in safe mode go to C:WINDOWS\System32 folder and copy
the wpa.dbl and wpa.bak files from your floppy/cd back to the
Windows\system32 folder. You will be alerted that the files already exist.
Just click OK to overwrite them with your backup copies. Now reboot and you
should be activated - Well that's the theory anyway.