Co-workers having trouble with vpn

I am able to VPN into the network at my workplace. When connected and I look at the properties of the connection, I can see that my vpn connection has been given a client ip address of 10.xx.xx.xx which is internal from the host server. This is good. My two co-workers however, can vpn in ( they are authenticated etc.) but they cannot do any work as they do not recieve a good ip from the host. They both get a 169.xxx.xxx.xxx address.

We all use the same os, winxppro sp2. Host is running Server 2003. We have reviewed every tab and setting within the vpn connection properties windows. We have even tried to manually set the ip obtained. No luck anywhere.

Please advise if you have any ideas.