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According the Paul Thurrott all you have to do is update like you normally would and then do a hard reset. That will be the same as a clean install.
Did just that, (option 2) now my surface is on an infinite loop of boot uUPS.. (inaccessible boot). I tried making a USB media using Microsoft's media creation tool, but it failed to complete twice, I'll try again later. I have an appointment at the Microsoft store for Monday just in case.
Can someone confirm that you don't need the key? i.e. it's in the UEFI
To clarify: I didn't have any trouble booting to the USB drive and performing the install. I used the Media Creation tool to build the USB and it worked perfectly. It's the post-install OS that I'm having trouble with. No audio, no WiFi, and after being active for a few minutes, it locks up and stops accepting input from the keyboard, touchpad, and even touchscreen.You have to use Rufus to format the USB drive as Fat32 and GPT, NOT MBR. It will not boot, since the Surface 3 is only UEFI.