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This is caused by a setting in Zone Alarm. In Zone Alarm program settings,
allowing Windows Explorer to access the internet (or the Trusted Zone alone) solves the problem.
You don't need to allow Windows Explorer act as Server, though.

I could repro the problem with the latest version of EZ Trust Firewall (powered by ZoneAlarm).
Windows Explorer just tries to the local PC IP address (127.0.0.1: port xxxx) or (0.0.0.0: port xxxx).
Therefore, rather than allowing Windows Explorer access to the Internet,
you may wish to add the local PC IP address to the TRUSTED zone and
allow Windows Explorer access to the TRUSTED zones only. You may add 0.0.0.0 and 127.0.0.1 to the
Trusted Zone and allow Windows Explorer access only to Trusted zone, but not the Internet Zone. (Credits to ZoneLabs forum for this Tip.)

If that does not help, reset the Zone Alarm settings to factory defaults and re-configure it again. All customizations in Zone Alarm will be lost.

* From the Overview Preferences tab and turn off the Load Zone Alarm at startup (or similar option)
* Restart Windows in Safe Mode.
* Open the folder named Internet Logs (usually C:\Windows\Internet Logs)
* Delete everything in that folder and empty the Recycle Bin
* Restart Windows in Normal mode
* Restart Zone Alarm manually and re-enable the Auto-start option in the Preferences.