Configuring Windows 2000 to use local DNS server

First Double click the "Network and Dial-up Connections" icon in the Control Panel:

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Then right-click the icon for the network connection and select "Properties" from the pop-up menu:

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Then in the connection properties dialog, select "Internet Protocol (TCP/IP)" and click the "Properties button":

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In the "Internet Protocol (TCP/IP) Properties" dialog, check "Use the following DNS server addresses", and enter the IP address of the local DNS server (*) as the "Preferred DNS Server":

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Finally click "OK" both in the "TCP/IP Properties" and "Network" dialogs to save your changes.

(*) The DNS server IP address must match an IP address that Simple DNS Plus is configured to listen on in the Options dialog / DNS / Inbound Requests section.
If you are configuring the computer which Simple DNS Plus is running on, you can use 127.0.0.1 (see below) - otherwise you must use an IP address which is accessible over the local area network.

NOTE: We also recommend disabling the "DNS Client" service

Windows 2000 and DNS server 127.0.0.1

If you try to enter "127.0.0.1" as DNS server in the TCP/IP configuration of a Windows 2000 computer, you will get the following error message:

IP addresses starting with 127 are not valid because they are reserved for loopback addresses. Please specify some other valid value between 1 and 223.

This only happens in Windows 2000 and we have no idea why Microsoft did this. But they must have realized that this was a mistake because this doesn't happen in later Windows versions such as XP and 2003.

To solve this, we have created a small tool which can set the DNS server to 127.0.0.1 on Windows 2000.
Simply download and run: setdns127.exe

REFERENCES:
For more information, please see the following knowledge base articles:

KB Article Disabling the Windows "DNS Client" service
KB Article Configuring Windows to use local DNS server

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