Which thing did you do that initially seemed to work?

Sounds totally like your isp to me. And it sounds like a p2p shaper program they use. It detects your program & then takes action. That's why your few few moments are ok until their program kicks into action.

Try BearShare Lite to see if you suffer the same problem. If yes, then it's the isp at fault. If no, then either the isp is only targeting LW or else the problem is elsewhere. http://www.filehippo.com/download_bearshare_lite/

If youe incoming is false, then that means you're firewalled. Make sure your firewall is properly configured. Also make sure your modem/router's UPnP options are turned on. If it doesn't have UPnP abilities then manual port forwarding is the go. See Connection problems? Check here first! (click on link) which covers all the points in this particular paragraph!!! ;)

changing the port number seemed to work...
anyway i can sort isp problem out???

If you can tallk to customer support but much more preferably a technician then there might be a chance.

You still need to fix up the reason why you're getting a false incoming report however. It's either due to your software firewall or else, your modem/router. What brand & model of modem/router do you have?
What firewall do you have on your computer? Which operating system?

routers cable and wireless...not too sure of the model tho...

firewell is norton.... though it still presents same problem even if i turn internet security off for a short period of time....

If you're using XP then make sure the XP firewall is disabled. Make sure Norton's firewall is properly configured to allow LW full access. Check to make sure your routers have UPnP enabled. See the link I gave earlier "Connection problems? Check here first! (click on link)"