Windows 7, connecting to Samba shares

I have a follow up question from the link above.

I am running Samba 3.0.23d on FreeBSD is release 7.1

I changed the policies as described above but still cannot connect to the samba server with the windows 7 or a server 2008. I feel it is a problem with recognizing the new machines on the network. the windows machines can see the samba server, but cannot connect to it or view any of the files. After changing the security policies the samba server asked for network id and password but would not allow the machine to connect, said they were unknown username or bad password.

Here is my current config file. there is no sign of encryption anywhere, should I just add the line? not sure what that would do elsewhere.

Workgroup = WWOFFSET
server string = WWO File Server (%v)
security = server
username map = /usr/local/etc/smb.users
hosts allow = 10. 127.

# If you want to automatically load your printer list rather
# than setting them up individually then you'll need this
;   load printers = yes

# you may wish to override the location of the printcap file
;   printcap name = /etc/printcap

# on SystemV system setting printcap name to lpstat should allow
# you to automatically obtain a printer list from the SystemV spool
# system
;   printcap name = lpstat

# It should not be necessary to specify the print system type unless
# it is non-standard. Currently supported print systems include:
# bsd, cups, sysv, plp, lprng, aix, hpux, qnx
;   printing = cups

# Uncomment this if you want a guest account, you must add this to /etc/passwd
# otherwise the user "nobody" is used
;  guest account = pcguest

# this tells Samba to use a separate log file for each machine
# that connects
   log file = /var/log/samba/log.%m

# Put a capping on the size of the log files (in Kb).
   max log size = 50

# Use password server option only with security = server
# The argument list may include:
#   password server = My_PDC_Name [My_BDC_Name] [My_Next_BDC_Name]
# or to auto-locate the domain controller/s
#   password server = *
;   password server = <NT-Server-Name>
   password server = SERVER0

# Use the realm option only with security = ads
# Specifies the Active Directory realm the host is part of
;   realm = MY_REALM

# Backend to store user information in. New installations should
# use either tdbsam or ldapsam. smbpasswd is available for backwards
# compatibility. tdbsam requires no further configuration.
;   passdb backend = tdbsam
;   passdb backend = smbpasswd

# Using the following line enables you to customise your configuration
# on a per machine basis. The %m gets replaced with the netbios name
# of the machine that is connecting.
# Note: Consider carefully the location in the configuration file of
#       this line.  The included file is read at that point.
;   include = /usr/local/etc/smb.conf.%m

# Most people will find that this option gives better performance.
# See the chapter 'Samba performance issues' in the Samba HOWTO Collection
# and the manual pages for details.
# You may want to add the following on a Linux system:
#         SO_RCVBUF=8192 SO_SNDBUF=8192
   socket options = TCP_NODELAY

# Configure Samba to use multiple interfaces
# If you have multiple network interfaces then you must list them
# here. See the man page for details.
;   interfaces = 192.168.12.2/24 192.168.13.2/24

# Browser Control Options:
# set local master to no if you don't want Samba to become a master
# browser on your network. Otherwise the normal election rules apply
;   local master = no

# OS Level determines the precedence of this server in master browser
# elections. The default value should be reasonable
;   os level = 33

# Domain Master specifies Samba to be the Domain Master Browser. This
# allows Samba to collate browse lists between subnets. Don't use this
# if you already have a Windows NT domain controller doing this job
;   domain master = yes

# Preferred Master causes Samba to force a local browser election on startup
# and gives it a slightly higher chance of winning the election
;   preferred master = yes

# Enable this if you want Samba to be a domain logon server for
# Windows95 workstations.
;   domain logons = yes

# if you enable domain logons then you may want a per-machine or
# per user logon script
# run a specific logon batch file per workstation (machine)
;   logon script = %m.bat
# run a specific logon batch file per username
;   logon script = %U.bat

# Where to store roving profiles (only for Win95 and WinNT)
#        %L substitutes for this servers netbios name, %U is username
#        You must uncomment the [Profiles] share below
;   logon path = \\%L\Profiles\%U

# Windows Internet Name Serving Support Section:
# WINS Support - Tells the NMBD component of Samba to enable it's WINS Server
;   wins support = yes

# WINS Server - Tells the NMBD components of Samba to be a WINS Client
#       Note: Samba can be either a WINS Server, or a WINS Client, but NOT both
;   wins server = w.x.y.z

# WINS Proxy - Tells Samba to answer name resolution queries on
# behalf of a non WINS capable client, for this to work there must be
# at least one  WINS Server on the network. The default is NO.
;   wins proxy = yes

# DNS Proxy - tells Samba whether or not to try to resolve NetBIOS names
# via DNS nslookups. The default is NO.
   dns proxy = no

# charset settings
;   display charset = ASCII
;   unix charset = ASCII
;   dos charset = ASCII

# These scripts are used on a domain controller or stand-alone
# machine to add or delete corresponding unix accounts
;  add user script = /usr/sbin/useradd %u
;  add group script = /usr/sbin/groupadd %g
;  add machine script = /usr/sbin/adduser -n -g machines -c Machine -d /dev/null -s /bin/false %u
;  delete user script = /usr/sbin/userdel %u
;  delete user from group script = /usr/sbin/deluser %u %g
;  delete group script = /usr/sbin/groupdel %g

unix extensions = no