Windows Server 2003 Question:

Using hidden shares on your network is useful if you do not want a shared folder or drive on the network to be easily accessible. Hidden shares can add another layer of protection for shared files against unauthorized people connecting to your network. Using hidden shares helps eliminate the chance for people to guess your password (or be logged into an authorized Windows account) and then receive access to the shared resource.

Windows automatically shares hard drives by default for administrative purposes. They are hidden shares named with the drive letter followed by a dollar sign (e.g., C$) and commented as Default Share. Thus, certain networking and administrator functions and applications can work properly. Not that preventing Windows from creating these hidden or administrative shares by default each time your computer boots up takes a registry change.