Can I configure a domain associated workstation to operate off of the domain under a separate user account? I want to do this to provide workgroup and internet access in case the server goes down. If it's possible, what are the steps? The workstations are XP pro and 7 Pro. The server is running Server 2008 R2.
I'm a little confused here by the question/problem you are seeking a solution for.
Why do you need separate accounts for when the domain is up or down? The 2 would not have the same desktop nor application settings thus if you have email configured for one client login you would need it for the other and they wouldnt share the PST's and such with out further administrative work.
I think it would be better if you just set them up to use cache credentials with domain accounts (no local accounts on the machines). Being the credentials are cached they are used online or offline and our users are 90% offline, which is the same as if the domain was down in your case.
When we build a machine their domain account is what gets added to the admin group and that is what is used to log in locally to the machine. Their local admin account is the only local account on the machine and is only used by Support people such as myself when needed (very very rare) being the user doesnt even know the password and we have to use a decoder to get it as it is different for every user.
What you want to do is setup a BDC ( backup domain controller ) for when the main server goes down. If you logon to a workgroup or local system, those accounts will not have the same rights at the domain user accounts and will not have access to network resources (if rights were setup properly that is). If all you want for them is local access to the computers and internet access, and you are not using a proxy server for internet, you can setup local accounts for each user, or a generic local account for them with guest access if you want to make things simple.