windows networking

I upgraded a workstation on a domain network to a new dell with XP Pro. If I
log on to the workstation as any user except me (domain administrator), that
user cannot add, edit or change any folder or file EXCEPT IN THE ROOT of the
C drive. They can do anything in the root folder but not in any
sub-folders. I have checked every windows setting I have ever accessed and
nothing seems abnormal. I would conclude that it is a basic permissions
problem except that they can create a folder, create a file and edit a file
in the root directory of the C drive. In all of my experience, unless you
set some specific permission, sub-folders always inherit the properties of
the their parent folder. In this case it isn't true, unless I log in as me;
then I can do anything. Also, I have configured new workstations numerous
times in the past and never encountered this problem.
Any help would be greatly appreciated.