And this KB Article explains that it's a firewall/timeout issue 
You may not be able to enumerate all the instances of SQL Server 2000 on your network by using an application or a program
Article ID : 885345
Last Review : September 14, 2004
Revision : 1.0
SYMPTOMS
If you try to enumerate the instances of Microsoft SQL Server 2000 that are currently active on your network by using an application or a method in a program, the application or the program may not list all the instances of SQL Server 2000. The application
or the program that enumerates the instances of SQL Server 2000 on a network can be your own custom application or a SQL Server tool, such as SQL Server Enterprise Manager, SQL Server Service Manager, or SQL Query Analyzer.
Note This problem occurs on computers that are running Microsoft Windows XP Service Pack 2 (SP2).
CAUSE
To determine and enumerate the instances of SQL Server that are running on remote computers, the application or the program uses the APIs, such as
SQLBrowseConnect, that send User Datagram Protocol (UDP) packets to all the computers on your network from a network port. The remote computers then send the details of the instances of SQL Server to the application or the program by using the same network
port.
By default, Windows Firewall permits incoming unicast response packets to a port for only 3 seconds after a multicast packet or a broadcast packet is sent from the port. If the remote computers send the details of the instances of SQL Server after 3 seconds,
the information is blocked by the Windows Firewall. Therefore, the enumeration may not contain all the instances of SQL Server that are currently active on your network.
WORKAROUND
To work around this problem, you must add the application or the program that enumerates the instances of SQL Server 2000 on a network to the Windows Firewall exception list on the computer that is running Windows XP SP2.
For more information about how to add an application or a program to the Windows Firewall exception list, see the "Allowing exceptions despite the risks" section on the following Microsoft Web site:
STATUS
This behavior is by design.
REFERENCES For additional information, click the following article numbers to view the articles in the Microsoft Knowledge Base:
841771 (http://support.microsoft.com/kb/841771/) All the instances of SQL Server or SQL Server Desktop Engine are not enumerated when you use an application or a method that uses SQLBrowseConnect
843090 (http://support.microsoft.com/kb/843090/) Description of the Windows Firewall feature in Windows XP Service Pack 2
875357 (http://support.microsoft.com/kb/875357/) Troubleshooting Windows Firewall settings in Windows XP Service Pack 2