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I'm going to assume the printer is shared at the XP box, and this is not running directly through your software only. If not, share it.
If you want to keep things as they are, make sure the printer is installed on the server, as a network printer. Make sure there isn't some firewall action going on as well (just a troubleshooting tip).
My advice would be this:
If the printer is USB/parallel then physically install it on the server, where the software actually runs. Share it over the network and have your workstations connect to that.
If it is a network/TCPIP printer, then have it installed on the server and share it, and have the workstations connect to it. Either way, the server controls the printer and has all the libraries/DLLs needed to control this device. Everything else depends on the server, as they should.
Using a workstation as a print server is never good, and will always lead to trouble. This is the hodge-podge way of networking, and it needs to become more formal.
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