Alternatively, buy Windows 10 license, when available.
You may not initiate services based on the use of the SOFTWARE. If that was OEM Windows 7, then you probably need to buy new license (Win7 or 8), restore the VM from backup, update/upgrade to Win8/license it with new license and then upgrade. You may not use the SOFTWARE to distribute illegal data or data that violates public policy. Right-click on the USB drive, click Erase.
If you can’t find the option to set the partition table, make sure you’re selecting the View -> Show All Devices option. Format your USB drive as Mac OS Extended (Journaled) and choose the GUID Partition Map scheme.
INSTALL MAC OS ON PC ILLEGAL UPGRADE
I had upgrades go really bad and destroy my Virtual machines - just to have next, same, upgrade of the same VM restored from the backup to go perfectly fine. First, right-click the USB drive in Disk Utility and click Erase. If the Windows 7 license was "retail" then Microsoft should help - or alternatively you can restore the original Win7 Virtual machine (you DO have backup?) and try again the upgrade to Win 10. The problem has nothing to do with Parallels, Macbook Pro system or whatever - and all to do with the original type of license of the Windows 7. That is the best I can make out of the description. However, once the Windows 10 were installed, the genuine status was likely lost and that is why you cannot get these Windows 10 activated. Seems like the Windows 7 "genuine" state somehow survived the original transfer to the Parallels VM. The reason is, that OEM versions are significantly discounted (as low as $10 for license for large OEMs like Dell or Asus).
Unless they were bought originally in store (retail version) in which case they can be transferred. It was incorrect and illegal to transfer them to Parallels virtual machine. If these Windows 7 were transferred from PC where they came preinstalled ("OEM" version), then they were licensed ONLY to run on that one PC. I'll try my best to guess the situation and explain. I guess the original question is confusing and so answers are confusing also.