Bob's brother-in-law here....
Some more information: I tried sharing folders under the Users folder (ie .C:\Users\usernane\Desktop) and no matter what settings I used in Properties > Settings, I could not get the remote XP box to access. It would show the share but it would not permit viewing. I set the permissions to Everyone > Full and still no access. This was true for several folders that I tried to share under the Users folder
I then did the same thing with some other random folders on another hard drive (ie: d:\videos\to_watch) and I was able to see the shared folder from the XP box, and I could gain access to the folder (ie: view, play, etc.)
So from this, it looks like something having to do either with the User folder tree or with the drive on which Windows 7 is installed. I tried sharing a folder that I created on the root of C:, and again, I could see it but could not access it from the XP box.