Win 7 preinstalled with download rights: still Free upgrade to Win 10?

You would have had to pay attention to whether it was activated to know for sure.

You can contact Microsoft Support phone or chat options here:

https://partner.support.services.microsoft.com/... but they may tell you what I've said repeatedly here which is that Downgrade rights are entirely controlled by the PC maker. I gave you their Support page on this. I would contact their Support chat to ask if WIndows 10 downgrade rights are in effect on the PC and how to use them to change to Windows 10.

What indicator would tell me if it would be activated?

At Settings > Update & Security > Activation under Status and Edition.

You can shrink C by about 100gb in Disk Mgmt. and do a Clean Install by booting the media, during Custom install choose the space you shrunk then Next to let it configure a Dual Boot and begin install following the gold standard Clean Install in this link which compiles the best possible Install of Windows which will stay that way as long as you stick with the tools and methods given, has zero reported problems, and is better than any amount of money could buy: http://answers.microsoft.com/en-us/windows/wiki...

After install watch the Activation Status to see if it Activates. If so post back a screenshot of Disk mgmt and I'll help you delete the old install and recover the space into C or as a data partition. If not then delete the test partition and Extend C back over it in Disk Mgmt.

This is the easiest way to know. You can also keep WIndows 10 and activate it with a Product Key if it doesn't activate, or if Lenovo won't help you with downgrade rights.

So that's what I'd do. Up to you.

Thanks Greg!

I'll mull this over.  But kindly clarify that if it does indeed activate, then it's really legal, right?

Of course it's legal. You're using Microsoft media to install it, it's connecting to MS servers to find and apply the Digital License. That's as legal as it gets.