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FIXED !!!!!
Ok Laptop is back working. One of two changes did it. The updated the install system. I know because I have been installing every few days to check it out. It is definately different. Second thing is that I found a check box titled "automatically configure settings" that was not checked it is under:IE7/tools/internet options/connections/lan settings/" Internet and email worked but was having a problem connecting to FTP site via windows explorer. This fixed it and POTC started working. If you are having same problem, check this.
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