Cannot Save Or Run Downloaded Files

A friend of mine has Vista on his 2 home computers. His and his Wife's. They recently rearranged furniture, including the computers. When they plugged them all back in to their router, neither their computers, nor their xbox, could connect to the internet anymore. They called their ISP(Charter Communication) and Charter told them nothing was wrong that their cable modem was showing up fine and seemed to be working just fine. So they had a tech come out to their place and the guy was baffled. He swapped out their cable modem but said nothing was wrong with the old one, he just swapped them to make them feel better I guess. But even the tech guy couldn't understand why they suddendly cannot access the net. Even removing the router from the equation did not help one little bit. A buddy of theirs brought his laptop over to their house and was able to connect to the net through their cable modem so we know the modem is working just fine.

Well, thats when my Brother told them to call me. I did all the basic things you'd expect, starting from scratch. We started with connecting directly to the cable modem and got what I expected, zilch. I checked ipconfig and noticed they had a 169.*.*.* IP on both computers. by the way I'm doing all this long distance since they live several hours away from me. That 169 is wrong, or at least it seems like it to me so I banged away trying to change that with no results. Every change I made
reset to 169 instantly. Even a restart didn't help. So I had them plug it into the router and got a normal 192.*.*.* IP. At this point, several hours after we began, I gave up for the time being on that particular problem............