Cant network Windows 7 with XP Home - 'Login Error'

Hi! I have 2 PC at home and would like to network them together so i could share the resources between them. But i could only manage to setup 'one way' - the XP Home could access the Windows 7 Ultimate but not the other way :-/

Whenever i double click on the XP Home, it will prompt me to login. But no matter what i enter, it will say its wrong. What weird is the 'domain'. The login dialog will show that im login into 'Domain: Windows7PC' when im trying to login into the XP. And after i have enter 'wrongly', it will show the username as 'Windows7PC\username' and ask to try again - it means im login into the Windows 7. And if i try to prefix the PC's name in front - \\WindowsXP\username then it will prompt \\WindowsXP is not accessible..... The specified username is invalid

Here is my 'settings'-
Windows 7 Ultimate SP1
Windows XP Home SP3
Both is on the same Workgroup/IPGroup/Netmask
Both has File & Printer Sharing Enabled
Have patch XP with KB922120v6
Have Shared 2 folders on XP
Changing the XP's NetBIOS over TCP/IP & Starting the Computer Browser Service(but change back to default after finding out its not helping)
Create a share account with same name and password on both ends
No third party firewall on both side(only Avast free). And have disabled Windows XP firewall but with same result

Please advice. Thank you.