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On a Windows 7 PC, I need to share several folders, I'll call them 'restricted1' and 'public1'.

Because I do not want to enable anonymous sharing, I have a user called 'public', with a password everyone who needs access knows.

'public1' should be accessible by every user in the local 'Users' group, as well as 'public' (i. e. accessible by everyone, effectively).

Now 'restricted1' should be accessible by Everyone except 'public'. So in the file sharing dialog (Folder properties -> Sharing -> Advanced Sharing -> Permissions), I selected permissions, allowed everything for 'Everyone' and denied everything for 'public', but it didn't work as expected ('public' still has full access), even though the warning message that pops up right after doing that suggests that it should actually work (the order in which the permissions are applied should be allow -> deny).

Even when I set the normal file permissions (Folder properties -> Security) to "deny full control to public" it doesn't work.

Can someone please explain to me why that happens? Or am I just going in the entirely wrong direction with this? Thanks.

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This is only half an answer, but "Everyone" is equivalent to, well, everyone -- anyone who knows your SMB server exists can find and connect to it. "Public" must be some kind of other group you set up, because it's not available as a built-in group on my computer. Consider revising your shares to include or un-include "Everyone". –  David Is Not Here Jun 30 '13 at 20:14
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