I have my WinXP firewall ON and I can now connect.

I used to get the "unable to resolve server" error message
so i went to the mIRC website and downloaded the server.ini file from the main page..

immediately after
I recieved the "unable to resolve firewall address"

To fix, under Tools->Options->Connect->Firewall
Even if you have NONE selected, change around the "Socks4" "Socks5" "Proxy" settings...I had Socks4 originally and changed to Proxy and this fixed everything. This works with the firewall on.

So in summary, select NONE and Proxy
I think the default is NONE and Socks4

Hope this helps someone