I've been noticing weird behavior while surfing the internet... I'm wondering what the heck is going on. I don't know if I have a virus or if someone is deliberately trying to get into my pc. I don't want to go into a long story but I think it is someone I know.

Gosh I'm not letting my cousins use my pc anymore either. Too many people in the house are using this thing doing who knows what while I'm not here. I'm going to password protect it!

Is there a good program or way for me to hide my ip address so I can surf at ease? & also a good firewall program since all I use is the win xp firewall.

Just about any software firewall is better than the built-in XP one, for the simple reason that third-party firewalls check traffic in both directions, whereas the built-in one checks incoming traffic only. Free firewalls are fast disappearing (Symantec killed off the free version of Outpost, though whilst it was bulletproof it was just too intrusive with too many alerts). The recently introduced "Comodo Firewall" is still free:
http://www.comodo.com