I've now installed 'Mike's Easy BMW Tools Package' on XP which contains all of the following: However, I've given up on PA Soft and installed the Oracle VBox with XP Pro running - which works great I tried installing PA Soft on that too, but I get a different error when trying to run it on XP - something about a CRC error? My laptop's DVD drive appears to have died, so I've had to install the demo version of PA Soft instead, not sure if that would be the same thing or not. can't remember if it was there in Device Manager. You can install 1.1 or 2.0 after 4.0, it doesn't overwrite. Most of this software works with XP with no problem at all.
I run Windows XP SP4 (unofficial) with no network connection in a Virtualbox VM and tell it to pass the USB connection through to the VM. Are the drivers for the cable installed properly and detected within Device Manager? More than anything that looks like a driver issue if anything.