After lots of playing around I believe I have sorted out the problem. *Something* was messing with PCTools Firewall on PC1 when I booted up PC2. I took it off and all has been well so far. Just using Windows firewall now.

My set up is as follows.........

Cellar play room,

PC1 XP Pro (Main PC for email, web etc.) The ethernet port is bust so using a Belkin USB to Ethernet Adapter.
PC2 XP Home (Mainly used for video editing but has 1TB USB Drive hosting all my movies) This PC also has NFS on it.
Maxtor NAS Box (mainly used for backups)

These are networked together using an old Origo Router With a 50 metre Cat5 cable to...

Lounge

Netgear DGN 2000 ADSL Router

Laptop Vista Basic Wireless "N"
Original XBOX running XBMC
WDTV for Hi Def TV, networked with a Belkin USB to Ethernet Adapter (Testing alternate firmware which uses NFS, hence the NFS share on PC2)