I'll probably forget something and don't have a machine here with XP installed at the moment - doing this on a Windows 2000 machine and they're similar but not exactly the same, but here's the gist of it...
(the networking troubleshooting help wizard is reasonably good by the way - you could work your way through that).
1 - you only want the ethernet connection set up for file transfer - it's different if you're planning on using it for connecting a cable modem/DSL modem. This is specifically for using an x-over cable or a hub only for file transfer purposes and without a shared/networked internet connection. Routers and servers as gateways are configured slightly differently.
2 - use the x-over CAT5 cable and connect the two PC's together or use straight-through CAT5 cables and connect both machines to the hub (which needs to be switched on!)
3 - in PC 1 (either machine, but I'd suggest the desktop PC), RIGHT click on desktop version of "my network places" and select properties
you should see Local Area connection which you should RIGHT click on and select properties.
4 - under 'General' Tab (probably the only one anyway) you should see Internet Protocol TCP/IP which you can double click on.
5 - Select 'use the following IP address' and enter 192.168.0.1
the Subnet mask should be changed to read 255.255.255.0
6 - On PC 2, do the same as above but instead of using 192.168.0.1 use 192.168.0.2 (or .3 or .4 etc depending on how many machine you want to network). The subnet mask is the same.
7 - you need to share folders on the PC or PCs that you want to provide access INTO. In other words if you want to be able to access the laptop hard drive from your desktop, then on your laptop you need to share the folder/drive etc.
8 - for each drive or folder that you want to share: The simplest way is to use Windows Explorer and RIGHT click on the drive or folder and select sharing.
Click the 'new share' button and give the drive a SHORT name that you will refer to it as such as 'Desktop_C_SYS' or some such and a comment to remember what and where it is.
9 - Click on permissions and select add. Personally I add administrator, administrators and my own login ID then give them all full control, and remove any access to 'Everyone'.
10 - do that for each and every drive / folder you wish to share on both/all PCs.
11 - in theory you should then be able to access the shared stuff from the other machine, but depending on the type of Windows login access controls you've selected for Windows you may need to provide a login ID and/or password. I use the administrator password for the machine I'm accessing (NOT the administrator password for the machine I'm accessing the other one FROM).
This setup should work unless I've forgotten anything stupid (I quite often do!) but is purely for when you're not trying to share an internet connection as it fixes the IP addresses of both machine to use a 'private' IP address. The range 192.168.x.x. is recognised as set aside from internet addresses. There are a couple of others but that's the one most people use. Network connection setup varies depending on what you're networking and what the network is there to do, but hopefully that should get you going. Any problems do let me know and I'll see what I can do
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Basically if you wanted to share a broadband intenet connection as originating from a router, then both PC's would need to have the IP address of the router set as their gateway and as the DNS server in the TCP/IP properties page and IP addresses would be set to automatically assigned. It's much easier and routers also provide a built-in hardware firewall that's pretty tough for hackers, even then it would depend on router etc. There's quite a bit to networking, it's simple once you get the hang of it but can be a nightmare for newbies!
