If setting up the printers to print via the SME server, then before you set up any client PC's, you need to set up CUPS to correctly work.
1) Go to yourserver:631 and set up your printer - if it's an HP printer, you can use CUPS's built in HP laserjet drivers. Define the printer queue as an app socket/HP Jetdirect then put in socket://ipaddressofprinter:9100, use the HP Laserjet 1010 (hpis) driver. You can then send it a test page from the CUPS main panel and should get a (you guessed) test page. That proves the connectivity etc.
2) You should also put the printer in the hostname panel of SME to fix it's ip address/mac address and make it resolveable then you can call it by name (eg hp1022n). Using DHCP for the printer makes sure it can resolve back to any workstations in the printer que query etc.
3) Once you have the server printing to the printer, then you can either modify the printer in CUPS to use a RAW printer driver (and then you won't be able to print a test page from CUPS), or create another printer in CUPS that points to the same ipaddress but with a RAW driver.
4) Then, you need to set up your XP Wks to use local printer, and instead of using LPT1 etc, choose a 'create new port' and for local port name enter "\\server\hp1022n", You will need to add the drivers locally via CD, built in WinXP driver or create a driver share somewhere.
Alternately, after step 1 or 2, you can just browse to the server, then you should see the printer attached. You can "connect", but you will probably need to add the driver, but it may pick it up if you already have it loaded on the workstation.
There is a process of loading the driver for automatic download as well I use all the time, but if you're new to SME and in a hurry, the above should get you going with what you are familiar with.