Problem with lan set-up for playing games

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So I have this little lan at home, it works fine for send files around and sharing my printer with my roomates, etc. But often when trying to play games I run into very annoying problems. The most recent example of this is C&C Generals: Zero Hour.

You see, when I try to get a game going with it, everyone can see me in the lobby, and can type to them, but I can't see them nor hear them. If I create a game it is seen, but no one can connect to it. In the options it says my ip is 127.0.0.1, whereas on every other cpu it gives their private ip, 192.etc.

Now my private ip is also 192.etc. but if I try to run a directplay test, it says I'm once again 127.0.0.1. Searches from another cpu won't find it. However, other people can connect to this test if I tell them my private ip and they manualy punch it in. In the games though, direct connect doesn't work. Sigh.

The router for my network is a SMC7004WVBR (from memory) and according to it my cpu is "localhost". For the purposes of this discussion the router firewall is disabled as well as the windows XP SP2 firewall.

So, any idea why I'm 127.0.0.1? Why is it my cpu was chosen to be localhost, and could I change it to another cpu (like the girl downstairs who will never, ever want to play games)? How can I finaly show my roomate just how much he sucks at C&C?

Sorry for the exesive legnth of this post, just trying to give you enough information to work with. Thanks for any and all help.

Edit: Forgot to mention, all the cpus on this network run win XP with SP2
 
Please do not use the acronym CPU in the meaning of a computer. CPU is a very specific term and means the processor inside your computer.

Your router has absolutely nothing to do with your problem. LAN traffic doesn't even touch the router part - it moves through the switch.

Have you by any chance named your computer "localhost"? Check your computer name in My Computer properties. Also, see the contents of \windows\system32\drivers\etc\hosts file.
 
My computer's name is "Danscomputer" not localhost. I'm at work currently so I'll check that file when I get home. Sorry about my confusion of technical terms, as my experiance with networking is limited (And BOY does it show). My SMC7004WVBR is just a cruddy little router/switch/firewall wannabe/wireless access point that I got for free.

Oh, and in case anybody was wondering, some games do work, such as Dawn of War.

Edit: So i checked that file and other than the comments it just said
"127.0.0.1 localhost"
Which seem to be normal, as all the other computers had the same.
 
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