Having searched extensively about this issue I find many people who are having the opposite problem, they're connected to their wireless network but can't connect to the Internet. Haven't been able to find information on how to connect a machine to a wireless network and keep it from connecting to the Internet. Just got a nice Asus wireless router, RT-N66 and thought I'd see if any of you might know a way to configure the router and the XP machines so I can share printing and files but not have the XP machines exposed to the Internet. Thanks.
Just create the home network and add the computer to it, and from the Network Connections / Connection Properties, disable the TCP IP Protocol removing the check mark from the box... Any user with administrative privileges can enable it again, but he can revert almost any of your restriction... so you should only allow Standard users and Power users at most. You can reasign user groups in: Search bar/or Run command typing "control userpasswords2" / Select user / Properties / Group membership / Others / Select user group.