Still in need of Dell branded Media Center Edition 2005.. 537
I'd also try Microsoft's AntiSpyWare product, though it sounds like you've done everything I'd think of to rule...
Perhaps if you presented your story to a computer magazine they might be able to help. Almost every issue has a story of how the author was able to use the infuence of the magazine to correct a serious problem.
Most of these problems are far less clear than yours, for example terms and conditions that the purchaser agreeed to, but didn't understand.
Dell could easily send you another CD, but choose not to, this could easily be fixed, unless the CD master was defective.
Another alternative, (other than the legal one you suggested) might be to create a web site outlining the problem. There are many Dell Hell pages around. The problem would be to attract attention.
Perhaps set up a web page detailing your efforts to take Dell to small claims court (if such insbreastution exists). Most big companies ignore small claims court until a judge issues a major settlement against them, usually in absentia.