It looks like you never got a response to this. Still have the problem? If so, some questions:
Did printing work at one time and then stopped or are you trying to set this up now and can't get it to work?
The fact that you can see the printer on the laptop probably means that the printer is compatible with Win 7, has a Win 7 driver, the driver is installed on the laptop, and the printer set to "share" on the XP. Correct?
I assume the printer works correctly when you print from the XP machine and there are no pending print jobs from the XP machine?
Any other networked computers sharing that printer? If so, does printing to that printer work on those machines? Any print jobs from those machines stuck in the printer's queue? Can...