After reviewing the MapGuide installation docs, I decided this might have something to do with DCOM permissions. I was on the right path, anyway, XP SP2 does change some default DCOM permissions, and for anonymous users, some change will probably have to be made to get it to work. Beyond the scope of what I was looking to do. On the mapagent virtual directory, I unchecked the anonymous access and set Integrated Authenitcation only. This fixed the problem since I am running a local-only installation. Hope someone will find this tidbit useful when using XP SP2.