In W2K, Domain==Active Directory.
You don't need to have a domain/AD...you can make the server a stand-alone. Works like a workstation in a workgroup. AD is a lot of overhead for a small LAN, and IMNSHO, a waste of time, particularly if you aren't already familiar w/ AD and DNS setups.
BTW, AD should give you a bunch of errors if TCP/IP isn't installed and configured correctly on at least one adapter *before* you start the DCPROMO process.
--Woodie