Same issue with me. I believe it's a firewall issue. I'm using Windows 7 (unfortunately) and third party firewall software. The windows firewall is off. I found that when i turned off the 3rd party firewall that i was able to connect. Windows computers are not at all intuititve. It's not enough to change your settings in Itunes and the Apple Tv and have it work. you have to tell the third party software that it's okay for an outside application/server to get access to your Itunes library. So open up the third party software and browse through the applications section and then choose your Itunes program and then allow traffic in/out. I think it's resolved at that point...but with windows, you never know.
Message was edited by: Rich in St Catharines