Apple TV content problem

I have got an Apple TV2 and I am experiencing a problem with viewing my iTunes content on there.

I am running iTunes on a Desktop PC with Windows 7, using the latest iTunes software (v10.4.1). Whenever I try to access the content on the Apple TV it says no content is available, music or films.

I have tried connecting the same Apple TV to both a PC laptop and a MacBook Pro, and both work without problems. I tried creating a new Library on iTunes on the Desktop PC, and just dropping in 1 track from the other Library, which also streamed fine to the Apple TV. However, when I import all media files, the Apple TV shows no content, as if some file is corrupting or hiding the fact that there is content there.

I can force the Apple TV to play any file by using AirTunes from the Desktop PC, but no content is accessible directly on the Apple TV.

Anyone have any thoughts? I am at a complete loss and don't know where to go from here. I even spoke to an Apple Support Engineer for an hour over the phone and he couldn't help. So now I turn to you lot to see if anyone has had a similar problem?

I have tried disabling the firewall for windows as well, didn't make a difference. There is no other anti virus software on the PC apart from a parental control system called NetNanny.

Help!

Did you turn on Home Sharing in iTunes on the Desktop machine?

Yes the home sharing is on. I can even play music from the Desktop Library on laptops connected to the same network and Apple ID, but the Apple TV won't.

The Library comes up on the Apple TV as expected, but when you go into the music or movie folder, it claims the folder is empty, even though there is loads of content in the Library.

Do you have the latest firmware installed?

It is a brand new Apple TV, bought 2 weeks ago, so I would expect so. The machine claims all of the software is up to date and the Apple TV works fine from other devices. It's only from this desktop PC and with this Library that it doesn't.