people wont be able to play the game if the CD key is already used, because when you buy it and use it, you basicly get the game to your account forever so giving it to someone else would kind of be pointless as they wont be able to use it :(.
Never installed could mean one of two things (you never used the CD to install but you could of put the cd key into steam, and you dont neccesarily have to install the game on there for it to be apart of your account :p no need to be all snobbeh)
Sorry if I came off as a "snob" the game has not been registered on steam nor installed it is 100% brand new and I'm willing to state a refund of credits if my claim proves to be false.