Several Microsoft Operating Systems, prior to Windows Vista, have an issue in that the VPN tunnel is created but DNS is not resolving to the VPN DNS servers. 

In order to fix this, the registry must be modified:

1.    Click Start, click Run, type regedit in the Open box, and then click OK.
2.    Click the following registry subkey:
HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Services\Tcpip\Linkage
3.    In the right pane, double-click Bind.
4.    In the Value data box, select the "\Device\NdisWanIp" item, press CTRL+X, click the top of the list of devices, and then press CTRL+V.
5.    Click OK, and then quit Registry Editor.

When the VPN is connected DNS will now resolve correctly.