I have PPTP and IPSEC running next to each other without a problem.
GRE is for PPTP and UDP 500 is for IPSEC.
Somehow he doesn't like the GRE packets. Maybe you didn't set the xp client up right?
If a tunnel dies as soon as the traffic stops, then probably you're behind a firewall of some kind (soft or hardware). Connection tracking tells the firewall that the connection stopped and new incomming traffic is blocked as the firewall doesn't allow incoming traffic...
So, next to the SME-server, are you behind a firewall or natting router?
Also, there are some buggy things going on between XP and PPTP on a SME-box. See forum for details.
grz,
Richard.