|The phone is connected to the PC how ? USB or Bluetooth ?|
You have a USB Wireless Adaptor in the PC and this should be Internet Connection Sharing with the XBOX WiFi ?
If you set up ICS using the USB Wireless Adaptor as the main device, it will automatically bridge the live internet connection provide by your phone to ICS. The wireless adaptor will be assigned 192.168.0.1 and the XBox 192.168.0.2
You appear to be trying manually to force a non-existent connection, let Winows take control !