Running Localhost server... connection problem.

To summarize:
Help me fix

from connecting to

I keep getting connection lost deny thing on the other computer using the same localhost.
I have been running my server well with portforward using my external IP address, but recently we have decided to create one at school for everyone to use it.

I know portforwarding is probably impossible at school, and I heard that running on localhost should work.
Currently it's working on the server running laptop, while desktops are unable to access the server by receiving the

I don't know what the problems are.
I am pretty sure all the firewalls are unblocked, because I can easily host Starcraft rooms including LAN play.


PS: Just to avoid trolls, yes I did get permissions from school.

My properties follows:

 

First of all, leaving the port field empty will still make it use 25565, so you might aswell put it back to that.

Moving on to how to connect using LAN.

Localhost is NOT equal to LAN. Localhost is on the same computer only.

To connect through LAN you still need an ip address. Although it will be different than the external one.

To get the INTERNAL ip address, Open a command prompt:

Xp: Run button>Type "cmd", press enter
Vista/Windows 7: Open start menu, type "cmd" into the search box, press enter

Then type "ipconfig" in the box

Look next to IPv4 Address. It will show your internal ip address. Use this on the other computers to connect.
It will change each time the computer is rebooted (Usually) there are ways to make it static (Doesn't change) but I REALLY don't think the school would appreciate you messing with their tcp/ip settings.

 

OK I have tried with static ip + dynamic ip, and it does not seem to work.

I have to use a laptop, so I hosted a server on my laptop. From my laptop, currently 192.168.1.xx is working.
But.. from desktop (not from the host), I cannot connect. I keep getting

Meanwhile from the desktop, when I host it (with portforward disabled), I can access the server hosted on the desktop with my laptop.

My laptop is 64bit ? Win 7, and the desktop is 32bit Win XP.

Do you guys find anything wrong with it?
I am pretty sure the virus scanner isn't it.