Windows XP and Windows NT workstation (and probably Vista) are limited to a maximum of 10 inbound connections from other computers. You can’t connect more than 10 together via a share, including printers.
You’ll likely want to share this printer off the server instead. If the printer isn’t network capable there are devices that run between $50 and $100 that will convert a LPT/USB printer to a network capable printer.
It sounds like you are sharing the devices on the workstation, but I can’t be sure, If you are connecting the printer to the Server (and the share the clients are connecting to is on the server) then you may be running low on CALS, or try restarting the print spooler service.