Microsoft forums to the rescue! Thanks to the miracle that is Google, I found someone with a similar problem. Solution: Write network name in url field, like this: \\TERRA. The XP machine now offers it shared folders for my browsing pleasure. Afterwards, Terra showed up on the network as well. For now.
It does not bode well for Microsoft that it is easier to integrate an Ubuntu Linux machine in their home network than two of their OS. You'd think that once you got them to work, they would CONTINUE to work despite turning the computer off once in a blue thunderstorm. Perhaps I should just buy a ridiculously cheap computer with ginormous hard disks and without OS, install Ubuntu on it and have all my shared folders there. Would easify backup too.