I was running into an issue where I had set a host header for a SharePoint site, but was unable to authenticate. I’d get prompted for credentials three times and then receive a 401 error. (The site worked with the computername and ip address.)
This registry change for BackConnectionHostNames fixed the issue for me: http://support.microsoft.com/kb/896861
I need to read up a bit more on what that is actually doing to be sure it’s OK for our needs though.