Vista - Network File Sharing Help

My parents have recently bought a new HP Touchsmart and I was finally glad they did so. Now I could free up space on my pc and also be able to play around with a new pc.
I got this bright idea that I would setup a personal network of sorts and would be able to freely transfer files from one pc to the other over the wireless network (instead of constantly moving around an External HDD) Thinking with vista that it would be somewhat easy to setup and use. Well surprise surprise that blew up in my face.
After wasting nearly 10hrs total of scouring every nook and cranny that is the internet I found many answers but no solution would work for me. I have two distinct problems atmo:
1. after sharing a folder on one pc I am unable to access it and I get the error of incorrect file path/denied access upon trying to diagnose the problem. On some files I am able to view 1 or 2 folders deeper but eventually ends up with the same problem.
2. When I am able to transfer files it gets as slow as 64 KB/s (Bytes not bits) when it should be at least 5MB/s since the wireless says it is capable of 50Mb/s
Solutions I've tried:
1. I have tried disabling the windows Firewall and also changed password protected file sharing to off. Also applying the user Everyone with full control of the files in question, ensuring both pc's are on the same workgroup.
2. I have disabled "Remote Differential Compression" to no change in speed. Though I noticed while transferring photos(6GB worth) the transfer speed got as low as 64KB/s (4 days)but with slitely larger files like videos it went as fast as 2MB/s, ordinary documents=1MB/s

The PC's in question specs:
XPS M1710: Vista Home Premium 32bit
AVG antivirus
Wireless G
Hp Touchsmart: Vista Home Premium 64bit (I am convinced that it is actually an upgrade from xp64 to vista 64 since some things look like xp style views instead of the fresh install of vista that I have on my M1710 and call me crazy but it feels different)
Microsoft Live Onecare antivirus
Wireless N
Router: Linksys WRT310N

I am willing to try almost anything. Please any and all help would be greatly appreciated. Even how to start all over disabling all current file sharing and setting up a more secure file sharing between Vista's.

PS. Also I am trying to transfer my parents email and contacts from Mozilla thunderbird to MS office Outlook 07 but am at a loss. Vice Versa was easy but this just doesn't want to work correctly.

Try booting these machines to [safe mode + net] and testing from there. If it's still the same thing, get yourself a crossover ethernet cable and monitor the transfer speeds when the wireless infrastructure is bypassed (wireless is frequently Teh Suck).

If you report back with that info, it may be possible to suggest a more practical solution.

Ok I'll give safe mode a shot and gonna have to move my router and other things around but in the end I hope for something properly work.
Thanks