I have a speedtouch usb 530 modem connected through usb. The internet works fine. One pc and one laptop. The laptop has a realtek 10/100 lan card. i plug the laptop on the modem's lan port and the network between pc and laptop works immediately. Internet sharing works fine and the icon on the laptop says 100 connected. But the speed of the transfering is very very very slow. Not even 5% of the bandwidth. It takes hours to tranfer files between pc and laptop. There is no program to help me play around with the modems lan port. I dont have an extra lan cart or port on the pc so my only lan port is that of the modem. The laptop is set on autosensing but even on full dublex 100 the speed is again crap. What is going on? I mean 600kB's tranfer rate!!! Thats like a 4x cdrom. HELP!

I'm surprise it worked at all.
You  are only suppose to use either usb or net, not at the same time. Buy your self a router and your problems will go away.

So i borrowed a realtek 8139 pci lan card same as the onboard on the laptop. Installed it, seted up the network and started transfering files. Speed is good about 80-90% of the 100mbbs bandwidth but cpu usage on the desktop goes 100%. The laptop doesnt go over 30%. Anywitch way i transfer files the desktop goes 100% cpu util. Changed drivers turned off and uninstalled firewall. Nothing. What gibs!? This pretty much renders the desktop pc unusable. It takes for ever to do anything while tranfering files. HELL! Do i need i a better lan card? WHAT!!?

I'm sort of confused about your network setup.  Could you do a little diagram or something of what goes to what?
just like:
modem(ethernet)-(nic)desktop(nic)-(nic)laptop
nic being the make/model of network card at that interface point or what sort of connection it is.

One speedtouch 530 modem connected through usb to the pc. Nothing elseon or from the modem except the dsl line. The realtek card a 8139 pci card that connects directly to the laptop's on-board same model as the pc's lan card. I dont care about internet sharing. All i want is to transfer files from the pc to the laptop and vice versa.
1 DSL LINE-MODEM-USB-DEKSTOP PC.
2 REALTEK 8139 NIC PCI-LAPTOP ONBOARD 8139

Just remember laptop speed are going to be lower than desktop. Most have 5400 rpm or 4200 rpm 2.5" drives. Mine seams to be at about 1/3 my desktop. Every thing is waiting on the hd. Looking at upgrading to a 7200 model.

What are the basic specs of your desktop and laptop? (cpu, ram, hd, etc)
Are you using a crossover cable from the laptop to the desktop? I'm assuming you are but just to be sure
What antivirus/firewall software are you using on the desktop and laptop?
 
Laptop hds are slower but not that slow.  My thinkpad t42 has a 5400rpm hd and i get solid 24mb/s transfers on gigabit to my file server.

desktop AMD Sempron 3000+ barton 1,5 gb ram kingston 3x512 4hdd 2x300gb maxtor sata 1x 160ata 1x80ata 8139 realtek pci lan card
avg free avtivirus
laptop 512 ram intel 2.0 cpu 40gb hdd realtek 8139 integrated lan avg free antivirus.  
by the way i disabled both antivirus programs on both pc with no effect on my problem.

Hm... If you go to task manager during a file transfer what service is using up all of the cpu time?
Just sort by CPU and see what .exe is hogging all the cpu.
 
Large file transfers can take quite a bit of cpu time (depending on software and the network card being used) and that semperon isn't the fastest of cpus.  Still, I dont know that it would flatline the cpu at 100% but anything is possible.  My Athlon 64 3500% gets up to almost 30% cpu usage at times when doing large file transfers.  I think at least some of that can be attributed to the antivirus though, I'm currently using avast.
 
I did a little googling and it seems that specific realtek chip does use more cpu than most cards.  It could be just your luck that the one card you have is the one that eats cpu time the most, lol.  My desktop computer has a Marvell nic in it but every other computer in my house and at work have 3com or intel nics.  They never have cpu issues when doing file transfers on those cards.

I have the same realtec card in one of my computer with out any problems. Going from computer to computer, You should be using a crossover cable. And since you do not have a router you should set your IP manually. It may be that the IP address you receive from your ISP is in a differnent zip code. Then moving over to your other computer, NO DHCP to change the setting.
 
Do you have another nic crossover cable to use? Or a friend that you can borrow a switch/router ?  
 
or maybe a antivirus/packet filtering software is inspecting every byte.

It seems that most of the cpu goes to explorer.exe and the rest to system idle process

It keep coming back to a ip address, Sub net, DNS server, gateway problem. Check your Network connection Info pages, see if they (ports) are on the same sub net. Not having a Router, means that a Static addressing is required.
 
It's possiable that you may have a bad card.

Uhm..
 
1. Always try to get a modem/router with ethernet instead of USB.
Ethernet was made for high performance networking USB was not..
 
2. Get the latest NIC drivers.
*Always* have up-to-date drivers, that counts for your Network Interface Cards aswell..
 
In regards to your CPU load problem..
The high cpu load/low network load is often caused by IRQ (sharing) problems.
Try to plug your NIC in a different PCI slot that uses a free/non-shared IRQ