Hi pawpaw,
Yes, the product key stickered on the laptop can be used with any proper install media.
However, you usually (not always) need to ring the oem - the manufacturer - to activate that installation.
It is possible to use the product key on the hd , but only in conjunction with the activation code - also on the hd. It is not hard to do , but not recommended unless you have a reasonable amount of knowledge. This avoids the need to ring to activate.
You can of course only install the Edition e.g. Basic, Premium, Ultimate that you paid for and which the product key is for.
The M$ dvd's contain the files needed for all the Editions - it is the product key (assuming you enter it when asked during the installation ) that determines which is installed from the dvd to your hard drive.
You may like to see this tutorial
http://www.vistax64.com/tutorials/117366-clean-install-full-version-vista.html
You may also like to make to make your own copy of the dvd - in case you want to install again, or use the repair functions.
Simply put the dvd in the drive, copy it to your hd as an iso image file ( most burning apps. will do this).
Then put a dvd recordable in the drive (do not format it, if autoplay pops up, just close it), and burn the iso image to the dvd.
Hope it helps
SIW2