Description of the Guest account in Windows XP
http://support.microsoft.com/kb/300489
Windows XP Baseline Security Checklists
http://www.microsoft.com/technet/archive/security/chklist/xpcl.mspx?mfr=true
From Windows XP Baseline Security Checklists:
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Make sure the Guest Account is Disabled
This setting recommendation applies only to Windows XP
Professional computers that belong to a domain or to
computers that do not use the Simple File Sharing model.
On Windows XP Professional systems that are not connected
to a domain, users who attempt to log on from across the
network will be forced to use the Guest account by default.
This change is designed to prevent hackers attempting to
access a system across the Internet from logging on by
using a local Administrator account that has no password.
To use this feature, which is part of the Simple File
Sharing model, the Guest account must be enabled on all
Windows XP computers that are not joined to a domain. For
those computers that are joined to a domain, or for
unjoined computers that have turned off the Simple File
Sharing model, the Guest account should be disabled. This
will prevent users attempting to log on to the computer
from across the network from using the Guest account.