What's simple file sharing?
What should I do if the Simple File Sharing doesn't work
Why I can't disable simple file sharing?
Why can't I have permission button while setup sharing on XP

What's simple file sharing?

A: By default, simplified sharing is enabled on a WinXP if the computer is not a member of a domain. Simplified sharing lets you easily share folders with everyone on your workgroup or network and make folders in your user profile private. However, if simplified sharing is enabled, you cannot prevent specific users and groups from gaining access to your shared folders. If you disable simplified sharing, you can allow specific users and groups to gain access to a shared folder; those users must provide a password to gain access to your shared folder.

If simple file sharing is enabled, you see the Simple File Sharing user interface rather than the classic Security and Sharing tabs. This new user interface is implemented by default in  XP Home Edition and XP Pro if you are working in a workgroup. If you disable simplified sharing, the classic Security and Sharing tabs appear and you can specify which users and groups have access to shared folders on your computer.

Why I can't disable simple file sharing?

According to MS, you cannot disable simplified sharing in Microsoft Windows XP Home Edition.

What should I do if the Simple File Sharing doesn't work

A: Sometimes, the simple file sharing does not work and other computers can't access the shared folders. In the case, you may want to disable the simple file sharing and re-share the folders manually. To disable the simple file sharing, open Folder Options by coming to Control Panel or Windows Explorer>Tools, and then click the View tab. In the Advanced Settings section, clear the Use simple file sharing (Recommended) check box. To share a folder, right-click the folder, select Sharing, type share name and assign permission.

Why can't I have permission button while setup sharing on XP

The reason you can't see the permission is because the XP simple file sharing is enabled. To disable simple file sharing, go to windows explorer>tools>folder options>view, uncheck use simple file sharing. Just remember that, after disabling simple file sharing, some users may have
difficulty to access the sharing folders.