After much ado that is after multiple re-installations, poking and probing through error logs and minutely studying the firewall, I decided that there must be something else that was wrong and hence I decided to check her hosts file (didn't expect it to be the worry as I didn't think she would have reached there) and there was the culprit. localhost was pointing to an IP that didn't exist in that network. Apparently, she had loaned out her PC for a few days to a friend and that's where it might have happened (well 'A Friend in Need is a Friend Indeed) ;)
Anyways deleting that entry that solved the problem, posting this answer as it solved the problem and just in case anyone over looks the hosts file being edited possibility.