Microsoft has issued a new advisory that Windows XP SP1 PCs with lowered security settings are also vulnerable to MS05-039 worm attacks similar to the ones that hit Windows 2000 systems. The Forced Guest account and open file sharing increase security risks anyway and they allow the worm to infect XP systems which were thought to be safe from this W/2000 based attack.  Microsoft noted that these particular settings are not often used.

Microsoft Security Advisory (906574) - Clarification of Simple File Sharing and ForceGuest

Microsoft has issued this Security Advisory to clarify information of the issue addressed in Security Bulletin MS05-039 for non-default configurations of Windows XP Service Pack 1. This feature is known as “Simple File Sharing and ForceGuest.”

If you are using Windows XP Service Pack 2, enabling Simple File Sharing and ForceGuest does not increase your level of exposure to the MS05-039 security vulnerability. Also, customers that have applied the security update included with MS05-039 are not impacted by this issue.

We recommend that customers continue to follow our Protect Your PC guidance of enabling a firewall, getting software updates and installing ant-virus software. Customers can learn more about these steps by visiting the Protect Your PC Web site