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Questions about Windows 2003 such as Why cant I access the internet if my windows server 2003 is down?

Hi I have been given the responsibility of overseeing two different Networks. (I don't have any formal network training, just have been learning as I go.) Both of them have one network server with Windows Server 2003.
1. Network A: 20  Windows XP Home computers connected to a Netgear FS750T2 Switch which is then connected to a Linksys RVS 4000 Router, which then connects to our Internet modem. The Linksys provides DHCP.  The network server is connected to the Netgear switch. Active Directory, DNS,  etc are not used on this server. The workstations all have "Obtain DNS servers automatically checked" The server holds files that are shared by everyone, and a SQLserver database.  There is no domain on this network

2. Network B: 40 Windows XP Pro computers connected to 2 Netgear Switches, which are then connected to a router, which then connects to the Internet Modem. The network server has to network cards, both of which are connected to the Netgear Swtich. Active Dirctory, and DNS are enabled.  the workstations all have the Windows Server set as the Primary DNS address, and a DNS server provided by our ISP as the secondary DNS server. There is a domain on this network. DHCP is provided by the router, other than for the servers 2 NIC cards, which have static IPs entered.

So here are my questions:
1. What is the advantage to the Network B setup, where the DNS server is provided by our Network server instead of the ISP DNS server?
2. In Network A, if the Network Server goes down, all workstations still have internet access. This is not the case in Network B. Is that due to the DNS server set up or can there be other reasons for this?
3. What would be the downside to changing Network B over to the set up that Network A uses, where the DNS is provided by our ISP? (Making Internet access independent of the network server)
4. If all workstations in Network B cannot ping the router today, when they could yesterday. Assuming that the cabling is not a problem. Can there be any other causes other than a bad switch or a bad router? (Could something in the network server cause this symptom?)
5. If the network server cannot ping the router when the server is connected via the switch, but it CAN ping the router when it bypasses the switch and plugs directly into the router, can there be any other cause to this problem besides a bad switch?
6. Is it common for some ports of a switch to fail, while others continue to work/

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it_saige
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Hi Saige,
thanks for the answers.
on Q #4 and 5. How would I be able to determine if the NICs are configured correctly?
thanks
Paul
I didn't get an answer to my question about the correct way to set up two NIC cards on the server.