Are you using a crossover cable? There are 2 different types of ethernet cables: straight-through and crossover. Straight-through is used for connecting to a router, whereas crossover is generally used for connecting 2 computers directly together, because it "crosses over" the wires internally so that the computer gets the data through the wires it's expecting them from.

To check what kind of a cable it is, look at the coloring of the wires. If the order of colors is the same on both, it's a straight-through, and if it's different, chances are it's a crossover.

Many newer ethernet cards automatically do the crossing over, so it doesn't matter what kind of a cable you use, which could explain the working connection between the PC and laptop.

well i think its a straight-through ethernet cable. So i'd need a crossover cable then ?
Also it went into commands and i could get a ping from the other computer would i be able to on the straight-through cable but not be able to actually create the network?

Yes, that would be the best thing to do.
Hmm.... you said the lights on the back of the cards weren't lit? That's odd. When you connected the PC to the laptop, was the light on at the back of the PC then? And you have disabled any firewall software, haven't you?

yeh thats right , the lights weren't on. and yes when i was connected to the laptop it was on. I have completly disabled the firewalls so those shouldn't be the problem.

Should i still just be trying for the cross over cable?

Yup, now I'm sure that a crossover cable will fix your problems.