First to enable Remote Desktop.
Go to the System Properties (right-click My Computer -> Properties) Remote Tab
Check the Remote Desktop checkbox.
Now to enable the telnet server. Pull up the Computer Management MMC.
Services and Applications -> Services
Look at the Telnet service properties, change the Startup type to Automatic.
Now add a user that would be used only for remote access. This can be a Limited Account or Admin, you generally would like to dedicate a user account for remote access for security reasons, and also a strong password is needed for remote access.
To add a user go to the Computer Management MMC,
System Tools -> Local Users and Groups -> Users
Right-Click, New User.
Now Add the user to the Administrators, Remote Desktop Users, and TelnetClients (you may need to create this group) groups.
Now to hide the remote user's account from the welcome screen in Windows XP. First Open Registry Editor.
In Registry Editor, navigate to the following registry key: HKEY_LOCAL_MACHINE\SOFTWARE\Microsoft\Windows NT\CurrentVersion\Winlogon\SpecialAccounts\UserList
Create a entry of the REG_DWORD type with a name is the username of the remote user.
Assign it a value of 0.
Now after all this, you should reboot and check that the remote login works.