Steven, you have a right to be furious. There are several products which can protect you, but the better protection the more of a pain it is for your customer to get your product activated.

I have had very high protection to very low protection, I find somewhere in the middle is best. I always hated getting emails from customers frustrated with getting the product activated, then giving up and just requesting a refund. But at the very minimum the download area should have some sort of protection on it.