Open OneCare and click on the link to Subscribe. Use the LiveID that you purchased with and it should recognize the subscription and activate.
For the Automatic Updates issue, go to Control Panel, Automatic Updates and try turning it on from there. If that does not work, or if you are still having problems activating, please contact support.
How to reach support (FAQ) - http://forums.microsoft.com/WindowsOneCare/ShowPost.aspx?PostID=2421771&SiteID=2
-steve