When you use Start / Run / control userpasswords2 / OK to add a user in Windows XP Home Edition, you receive errors similar to:
The user could not be added because the following error has occurred, The group name could not be found: When creating a new user and make it member of the 'Power Users' group.
The group membership for <ComputerName\UserName> could not be updated : When updating an existing user, adding him to the 'Power Users group'.
DO NOT use the Userpasswords2 applet to add or modify users in Windows XP Home Edition. This tool is reserved for Windows XP Professional Edition.
The Userpasswords2 applet allows access to the Power Users group which is NOT a built-in group in Windows XP Home Edition.
To add or edit a user in Windows XP Home Edition, use Control Panel / User Accounts, which does NOT show the Power Users group.