First, you can try this fix:
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Check out this thread for some things to check on the xp machine.
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Can you ping the xp by name from the windows 7 computer? If not then its a simple DNS issue.
At search type cmd and in the cmd box simply type ping and something to ping like google.com it will send 4 packets to google and when they get there they will come back it will look like this: The smaller the numbers in min & max the better your connection is. you can also ping an ip if you know it
Your ip is provided by the isp outside the router and inside by the router since its giving you your inside ip (something like 192.168.1.105) so the router has to translate ip to machine name...