It's most likely a firewall problem. We did do some magic to try to get around firewall issues, but it's possible that it may not be working in your case.
If you're familiar with your firewall/router, you can try opening up ports 24200 - 24300 and that should cover it, hopefully.
As far as your hard drive thrashing, here's a few things to try first:
* Make sure you don't have a lot of programs running in the background.
* Try restarting your computer.
* Run a virus and adware check. AVG Free and Ad-Aware SE are good, free programs for this.
* Defrag your hard drive, or, if your hard drive is starting to get full, clean it up a bit.
Let me know if either of you need anything else.