I am not with Laminar Research; just a flight simmer.
Like you I also have the disc set version of X-Plane 11. If your set is from Aerosoft the registration/activation key supplied is a "con" or "ploy" to get you to purchase further items from them at a possible discount rate. It has no impact, as you have found, on allowing you to run X-Plane.
Because you have installed the disc version, disc 1 has to be inserted in your disc drive at all times. If not the program will automatically revert to the demo mode. A pain in the backside as there is always a risk the disc will become damaged.
From previous correspondence I have had with Laminar Research there is no intention to create a USB dongle for X-plane 11 as was the case with X-Plane 10 as a substitute for disc 1. Other disc users have also raised the issue hoping the backward step will be rectified.
The alternative is create an ISO disc/usb dongle, if you know how, as the working substitute.
Hope this helps.