The tracking software could have been activated sometime after you bought the laptop from the pawn shop. It is a strong sign that the laptop was stolen, then sold to the pawn shop. I recommend returning it and asking for a refund.
As for the reason you give to the pawn shop owner for a refund... that is up to you. Stating outright that you believe it is stolen due to the tracking software popping up is the right thing to do, but that could mean the owner will refuse to refund your money if he / she is unscrupulous which could mean you need to go to small claims court to get your money back. On the other hand, if you simply say something like it does not meet your expectations, then someone will end up buying it.
When it comes to buying stolen items, it is the last person who is holding onto the item that gets burned when it is tracked down.