It seems not all of the testing was done on Service Pack 2.
Microsoft has had to issue the first patch for the recently released Service Pack 2.
Quote:
SYMPTOMS
On a computer that is running Microsoft Windows XP with Service Pack 2 (SP2), programs that connect to IP addresses that are in the loopback address range may not work as you expect. For example, you may receive an error message that says that you cannot establish a connection.
CAUSE
This problem occurs if the program connects to a loopback address other than 127.0.0.1. Windows XP Service Pack 2 (SP2) prevents connections to all IP addresses that are in the loopback address range except for 127.0.0.1.
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http://support.microsoft.com/default...5bLN%5d;884020
How much time and money did they spend on SP2?