I don't see any hardware limitations, only software ones. How about this, a bluetooth wireless USB stick on both computers for transfering files with no cables!
Brent is correct, there is no reason this can't be done. But don't think you'll get rich doing it--it has already been done. You can get the cables for about $20. Or you could use my perennial favorite, scp.
Ooooh, I want a set-up like that! just imagine the files you could steal without people knowing or the havoc you could play - - - mwuahahaha!!! Damnit I hate having to include this: just kiddin' I am way to benign a person to use tech for destructive purposes!
Those aren't ordinary USB cables, though. TremblingBluStar is right that there are hardware reasons why those can't be used.
Mainly because using a conventional USB cable would short out the USB port(s) on one of the two PCs involved in the link. USB transfer cables avoid that particular headache (and there's no file sharing or IP addresses to set up), but they're not exactly fast compared to a standard ethernet setup. GM
While browsing the Wal-Mart electronics section the other day, I noticed that they now sell a "file transfer kit" that includes the software (CD-ROM) and a crossover cable. It was packaged as a simple way to transfer your files from XP to Vista, but I'm sure it would work from XP to XP.