Yes when you re-open LW & reset the preferences then LW will create a new fresh preferences folder.
University is the killer word there. Many a university is blocking p2p nowadays. There can be numerous ways they can achieve this. One is blocking ports.

Do this simple test for us. Using your browser go here: http://www.grc.com/port_6346.htm (Press Probe this port button) Does it say open or closed? If closed, try another port number like 3910 or 5105 or 80. (You can change the port test no. desired.)