This one is more of an OS and application compatibility issue. Media sharing is not a feature of Windows Server products. I believe it is due to a networking service that is not included in Server. It wasn’t in Server 2003 and its also not in Server 2008.
So if you want to share media to an Xbox 360 through WMP11 you simply cannot. The sharing option is greyed out. The only way is a third party app like tversity.
This is pretty much a known issue now but I was hoping someone might find a way to make this work. So maybe add this to the wish list?
Ugh I really don’t want to install Vista and XP seems so old now.