Why does Public Folder share prompt for password even after I set "Turn off password protected sharing"

I have a fileserver on a WORKGROUP.

I have turned on public folder sharing, file and printing sharing and set password protected sharing to off.

When I try to share a subfolder of the public folder by right clicking it and selecting proerties, then selecting sharing tab, then clicking the "share" button, then clicking share, it prompts me asking wether or not I want to turn on network discovery for public network, and after I say either yes or no, it says that my folder cant be shared.

When I try to share via advanced sharing, then the folder is shared, and it's status is set to shared.

However when I try to access this folder from a computer on the same network, it prompts me to enter a username and password.

I am trying to setup a share for my VMware ThinApp packages that can be access no matter what domain the users are on.