It is, indeed, varieties of Office that this applies to. The concept behind this is that you are only using one copy of office at any one time, whereas the OS is used by the computer "all the time" in order to work. Conceptually, it does make some sense.
Student & teacher Office can be installed on up to 3 machines, I believe.
With the XP operating system, if you only have one code, you can only install it on one machine.