I've got two computers, a Mac (OS X Leopard) and a PC (XP). Each have an external hard drive (USB). They're both on the same network, and I'd like to configure file sharing on them so they can see each other's external storage.
What settings do I need to tweak, andwhat security settings should be set (if any)?
The simplest way is to share them just like you would share a folder on your computer.
Sharing
To turn on File Sharing in Windows, right click on the drive in My Computer and choose Sharing and Security... and then choose to enable it.
To turn on File Sharing in Mac OS X, go to System Preferences and click on the Sharing Preference Pane. Then check off the check box beside "File Sharing". Lastly, click the Options... button and check off "Share files and folders using SMB".
Connecting
To connect to the Mac from the PC, if set correctly the Mac will show up in the Network section. You then just need to give it your username and password you use to log into the Mac. If it does not show up automatically you can manually enter \IP_ADDRESS_OF_MAC\ in the Address Bar in Explorer and then enter the Username and Password - on some setups you may need to prefix the username with "\IP_ADDRESS_MAC\"
To connect to the PC from the Mac, by default in 10.5 the PC computer name will show up in the Sidebar in the Finder under the Shared section. You can click on the PC and then press the Connect... button. If it fails to show up, in the Finder from the Go menu choose "Connect to Server..." (Command-K) then simply enter
smb://IP_ADDRESS_OF_PC
and then enter the username and password that you use to log on to your PC.Permissions
Permissions for various accounts can be set in the Sharing and Security window on the PC, and in the Sharing Preference Pane on the Mac.
Caveats
Since you're using file sharing - obviously you'll need to make sure the other computer is on. You will also want to check out another couple of questions here on ServerFault: 4599 and 5564
The real issue is deciding on a disk format that both OSes are friendly with. E.g. OS X cannot natively write to NTFS, but it can read it. A solution for this is MacFUSE (google it) and its ntfs-3g driver. On the PC side, if you share its attached drive than you should be able to mount it over Samba on OS X. If the drive that is attached to OS X is formatted as Mac OS Extended than Windows will definitely not be able to read it - so you will want to convert it to a format that both OSes can access, either Fat32 or NTFS (which again, you can only access via MacFUSE).
Ultimately its down to getting a disk format that both OSes can handle. When this has been accomplished than you can share both drives and access them via Samba on OS X and Windows.