I want my friend to try the original Ghost Recon so we both downloaded the demo but no matter what we do we can't configure the server correctly so we can play together. What is the procedure for setting up a server in game and giving my friend the ip address (and how do I find the correct ip and port) for the server? Thank you.

Are you behind a firewall of any sort? XP has a built in firewall that you have to set to allow GR to pass through. If you have a hardware firewall in use, you need to open ports 2346-2348 TCP and UDP and forward them to the computer you wish to play the demo on. Both parties need to do this,

Also, you need your external IP and not your internal IP. Go to What Is My IP.com to get your external IP. If you are hosting, give that IP to your friend to join you after you start your server.