LE doesn't use the key, but it uses the PACE drivers with the authorization code that you have to enter when you install. Has as long as I can remember, all the way back to PT version 5.x.
Are you running a virus scanner? If so, turn it off.
When you updated the PACE drivers, did you get the latest update from
The PACE website? You said the driver is not there at all? That doesn't sound right at all. Try re-installing those again.
When you updated to 7.0, did you update any non-core plugins? (Details about doing so are on the
7.0 info page) Do you even have any installed? If so which ones?
My only other suggestion is to uninstall Pro Tools, delete all traces of it and the pace drivers, and try a re-install.
Other than that, you'll have to
Contact tech support