Thanks Vla for spotting this over at NTCompatible Normally Windows XP Home Edition cannot join network domains, simply peer-to-peer workgroups. However, there is a fix which can solve the problem and allow WinXP Home Edition to join a domain. Microsoft wanted to cripple Windows XP Home Edition so that it could not be used on domains, which would force many to upgrade to the more expensive Windows XP Professional Edition simply to join a network domain.
However, it -is- possible to get on a domain using Windows XP Home Edition.
Method 1:
This can also be accomplished with the free and widely available Xteq X-Setup 6.1 https://www.xteq.com/products/xset/ by navigating to the NetworkAuto LoginWindows NT/2K/XPSettings option within X-Setup. Simply enter the appropriate information and click Apply Changes - upon your next reboot you can then join domains with WinXP Home Edition. Problem solved. X-Setup includes many other useful Windows XP tweaks/hacks/etc. for Windows XP as well, all free for personal use.
Method 2:
As Serdar Yegulalp pointed out in his Win2kPowerUsers newsletter today also, this can be accomplished using Microsoft's TweakUI for Windows XP, but that has been pulled from Microsoft's website for the time being. I feel that it is very possible, if not highly probable, that Microsoft will prevent this workaround from being used with future versions of TweakUI with Windows XP Home Edition, as they authored both Windows XP and TweakUI, and they don't want Windows XP Home Edition users to be able to join network domains. A copy of TweakUI for WinXP can be obtained at https://www.majorgeeks.com.
News source: NTCompatible