Im running Win 7 on laptop and WHS on my dekstop.Somehow I can't see my dekstop computer under network, just my laptop and vice verca.What is it that I have missed?

Do you have both computers set for discovery?

Both computers as MSHOME, and set for discovery indeed.I managed to get to the shared folders on my desktop by typing \\192.xxx.x.xxxin explorer. But not the best option though

The question was are both computers set for network discovery. Are they?

YES!!!

My bad, I didn't read your whole post! I'm not sure about Windows Home Server, I'm checking it out to see if I get the same problem.