Although I could join the homegroup with no issue, none of the computers could see the shares on the other, nor the default profile folders (documents, pictures etc..) and when I tried to view the full network map (found under the "Network and Sharing Center"), it was showing a strange network topology that didn't look anything like what I had, and didn't show the other machines properly.
Everything was configured correctly - but it just didn't work. How Frustrating.
After fiddling a good deal and looking up a few solutions in various forums, I almost gave up when I though i might check the configuration of the computer name, and found the setting below in the screenshot which I don't recall seeing before, but there it was under the System Settings -->Change Settings-->Network ID.
Changing the value from "This computer is part of a busines network etc..." to "This is a home computer; it's not part etc.." fixed the issue.
The Network map was now correct (infact I was impressed, it was spot on - even with multiple routers!), and so I repeated these steps on each computer in the network which also fixed their maps as well.
I then removed all computers from the home group, create a new home group and joined all the PC's again to it. Once I did this, the home group was up and running. I have no idea why this works, and ever after re-booting it's back to the "business network" option, but all I can say is it solved my issue and now I can enjoy the fruits of Windows 7.
