David,
Have you tried setting up Limited Accounts and still getting the same results in terms of programs that run for all users? I mean if you create all administrative accounts for users, they will all have the same access to everything.

With the limited accounts, it should be more restrictive:

http://www.wown.com/j_helmig/wxphusrm.htm

What programs are specifically running that you'd like to limit?

As for your second question, I believe what you can do as the administrator is control the services yourself, in computer management.

However because this is XP Home and not XP Pro, I cannot advise you well on that. I do know that XP Pro is much more robust in terms of user control than Home.

If it is imporant to you, you may want to make the upgrade to XP Pro, and have the full functionality of controlling nearly every aspect of the user accounts on your computer.

In XP pro, you can manually configure each service to log on as a local group or on a per account basis, and you can password protect each one as the administrator. That way when a guest or I believe even a power user logs on, the administrator controls what runs and doesn't.

Take a look at the image below for an idea of what I am talking about. You can check to see if XP Home has this feature but I am going to guess that it doesn't.. maybe you can correct me if I am wrong.

Have a look