Okay everyone I called Microsoft and I know what happened. It is a bit confusing, but here is the following:
Microsoft currently offers a free upgrade from windows 10 to windows 11 (OEM or Retail)
Microsoft does not offer a free upgrade from windows 7 or 8 to Windows 11, this means that if you obtained windows 10 from an upgrade from windows 7 or 8 it would not be counted as a proper windows 11 license for fresh install. This means if you do a fresh install you will not be able to activate your windows 11 with you Microsoft account that you linked to your license. (This applies to retail copies).
You can however, upgrade your current Windows 10 to Windows 11 just not a fresh install, but if for some reason you choose to do a fresh install then you will have to buy a new Windows 11 license. So if you can UPGRADE and then RESET your Windows DO NOT do a fresh install.
If you bought a windows 10 license (not an upgrade from earlier ones) you can do a fresh install to Windows 11 during this free upgrade offer, once they close the offer you won't be able to.
Hope that helps. This licensing thing just made me think retail version of the OS is pretty worthless now.