Right. Firstly I would put the machines into a new Workgroup. There alway USED to be a BUG with MSHOME.
Ensure both the PC's are uploaded with all the latest updates/SP's.

When your at this stage, I would consider manually setting up the machines. At a guess you are using DHCP for the router to give your PC's a network address.

I am gonna stop here or Ill bore you. Come back and tell us if you are running any anti-virus' firewall programs. Then I can suggest some more things.