my copy will tell me "Failed to resolve blah blah" if the hostname doesn't resolve. You said it said couldn't connect, so I assume the hostname is valid but its pointing to the wrong IP?

If DNS names start to piss me off I will just set static IP's (either in my router via DHCP and MAC addresses or in the TCP IP properties for the network adapter), and then edit C:\Windows\system32\drivers\etc\hosts. Then its all said n done, and you don't have to worry abuot Windows DNS incompetence. Theres too many unknowns to possibly tell you why it is like it is, and this might not even work. For example, I have no idea what kind of internet setup, NAT on a router? ICS? I have no idea how your DNS is configured, on a router? etc.. you can't possibly expect anyone to tell you exactly what to fix.