OK, I'll give it a try. I'm not in XP right now, so I might get the
[exact wording of the steps wrong, so please ask if you aren't sure.
Start with the PC that has the modem connceted to it.
Right click on Network places on the desktop (hopefully there is one!), and select Properties. Then right click on the icon for Local Area Network. In the list that you can see, select TCP/IP, and you should get a box that you can enter numbers into. Where it says IP Address, enter 192,168.0.1, and it should fill in subnet mask automatically (255.255.255.0). Then save and close that box.
Now, do the same on the other PC, but change the IP address to 192.168.0.2. Subnet mask the same (255.255.255.0).
Now the two PC's shopuld be able to communicate. Test this on the modem-connected PC by opening a Command Prompt and typing
ping 192.168.0.2. If it gives a nice set of numbers, you are good to go. If it says Request Timed out, there is a problem.
Report back after those steps and then we'll progress to internet sharing.
Cheers
Mick