After the user succesfully activates the product and it get installed/extracted there are no more activation checks?
No, you have to add the activation checks to your application.
So someone can take the executable and copy it many time and they will all work fine?
Only if you don't add activation checks to your application.
Is there a way around this?
Besides adding activation checks to your application? You could make the installer your app. Every time it runs it (a) checks the activation (b) extracts your files to a temporary folder (c) deletes the files after your real app exits.