Hey helbigtw, I'm guessing since you're knowledgable about nets and stuff that you've disabled/configured XP's firewall, right? Well, if it so then it's possible that either:
-Your roommate is a nasty hacker that has found a way to succesfully go through the firewall
or
-The firewall is, for some weird reason, configured to allow only your friend's computer to have FTP connections (don't laugh: it is possible)
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