did you get to try the crossover cableat your friends house, or just the Xbox ..
I would have a better grasp on your problem, if it happend to me first, but honestly, i have high speed dsl, i just hooked up the xbox as in this tutorial, and away it went ..
http://www.xboxtutorials.cjb.net/
Btu ... i still use the PC while networking to the X-box, no problems