Networking Issues

This is for a friend and has no relation to my current networking question which is opened.

System 1:
WinXP Pro
1.2Ghz Celeron
458 MB RAM
LinkSys Wireless Router – Hard wired to machine via 3Com Ethernet 10/100 card

System 2:
WinXP Pro
800Ghz
256 MB RAM
LinkSys Wireless Network Card

Problem –
Tried to use Windows built in “Set up home or small office network” Option in Network Connections. Before activating this network, both machines had Internet access. After initializing the network, System 2 lost it’s internet connection. Upon deleting the Network bridge, System 2 immediately reagined internet access.

Trying to get both machines to use the Internet, and share files/printers between each other.

Any suggestions?