To pmv,
To start out with, its never a good idea to have two software firewalls, given the fact that zone alarm free is better than the windows SP2 firewall, its time to disable that sp2 one. Go to the windows firewall in the control panel, disable the sp2 firewall, and then go to the security center in the control panel, click on the firewall recommend tab, place a check mark in the box saying I have a firewall I will monitor myself. Its been my experience with all other third party firewalls, that failing to do that will cause the sp2 firewall to disabled internet connection sharing, in and of itself. And I find, even with a third party firewall, every time I happen to re set up ICS, something I can now do in a few minutes, I have to clunk the sp2 firewall on its head, before I can get internet sharing to work. Simply because every time anything changes, the sp2 firewall turns itself back on, to ruin and not save the day.
I suspect the dynamic address you refer to is your modem to isp address, your host computer should have a unchanging default address of 192.168.0.1. No static addressing needed. In terms of your client computer, I usually accept whatever xxx address ICS chooses, and then later make it static per KB 309642. Which will prevent a trainwreck if your client computer ever tries to choose a networked address of 192.168.0.1. in the ICS state.
In terms of, " Windows troubleshooter says that to use internet connection sharing I actually need _two_ NICs on the host PC. I am a bit baffled by this, as surely if the net connection is via USB it isn't using the NIC for that? Is the network card being used even when I connect the modem via a USB port rather than the ethernet port on the card?", that refers to an alternate method of setting up ICS in the event your modem connects to the host computer using an ethernet cable, since your modem connection is by USB, you do not need that second NIC on your host computer.
In terms of getting your zone alarm free to work with your ICS, you may have to, gasp, read the zone alarm help files on how to do it. But I use the comodo3 free firewall, and it uses net work zones, accepting every
network ICS address from 192.168.0.1 all the way up to 192.168.0.255 as addresses in the permitted range not to firewall out. IMHO, the freeware comodo3 is vastly superior to zonealarm free, and I can tell you exactly how to set comodo 3 up for ICS in a few simple steps. Zonealarm, I am not familiar with. I am somewhat familiar with the freeware version of the online armor firewall, and it too has its totally different gotcha's in terms of networking, until you learn to configure your firewall for networking. Almost every soft ware firewall will kill networking in its default state.
But with static addressing, I can send my client computer on line by itself using its own modem, but the nature of ICS means that the client cannot share its internet connection with the host.
But bottom line for you pmv, if you are going to use zonealarm free or any other third party software firewall, turn off the sp2 firewall, failing that, ICS will not work right off the back.