When you delete the prefs folder, all options are reset to default. So, at least we know you deleted that folder properly! You'll have to make sure that you go through LW's options & reset everything (don't forget things like days to keep incomplete files).

Just right click on My Computer > properties > general & you'll see your OS.
Make sure that LW's being allowed through the Windows firewall. More info in the link below.
User Cant Connect - LimeWire

In LW file > disconnect. Wait a few minutes then file > connect.

Did you use the offline installer for your Java? Do you have any other Java versions on your computer? If so, go to add/remove programs & remove other versions.

In LW tools > options > advanced > firewall config. Change LW's listening port to 64049 > apply > ok. You can also try other ports in the range of 49152 - 65535.

AFAIK there's no firewall in your modem, do you have a router as well?