it's pretty easy to add an ftp server in win2k professional. go to add remove programs control panel. click on "add/remove windows components". in the list that comes up, choose IIS "internet information service".
after it installs, right click on my computer, select manage. under "services and applications", click on services. you'll should see "FTP Publishing Service" listed. Start it up if necessary with the "play" button. IIS also installs a webserver and smtp server, so you probably want to stop those services and prevent their starting automatically when the pc boots up by going into properties and changing their startup type to "disabled." also, you probably want to firewall the box and only allow access to your friend's IP.
Then in the same window, on the left side, expand "internet information services". you'll see "default ftp site". right click on it, and select properties. in the window that comes up, you can tweak the ftp server settings if necessary. don't set the root directory to anything like C:\ unless you want the world to be able to see your whole hard drive--the default location should be somewhere isolated like c:\inetpub\ftproot. you'll have to add a user to your computer for your friend (using users control panel) which he will use to log in to the ftp service.
dunno about xp if you're using that, but it's probably very similar.
Personally, I never use FTP to transfer files since it transmits usernames and passwords in plain text. Using SSH service under cygwin allows for encrypted logins and file transfers, but it is far more complex to set up and use.