How can I configure the system so all users share a common favourites folder?

Choose a server that will host the favourites (favorites for all you Americans :-) ) folder, and create a favourties folder on it

Set the required permissions on the folder so that the users can read it (and add to it if you want that, probably not) and make sure it is shared

Fill the folder with the required links etc.

On the PDC edit each user entry and using the registry editor (regedit.exe), change the Favorites value in the "HKEY_CURRENT_USERSoftwareMicrosoftWindowsCurrentVersionExplorerUser Shell Folders" key to the path of the common favourties folder, e.g. \pdcmainfavourites,then click OK