Networking. The networking in Windows XP Home is not designed for use in any networking environment beyond the home or a small office; Microsoft themselves recommend that it should not be used in a network of more than around five machines (see this explanation)
Currently our network is based on Novell Netware. Novell do not support their client software on Windows XP Home, based on Microsoft's position - it is not designed for use in corporate or enterprise networks and so therefore they are not doing any work on their client on XP Home.
In the future we may move to Microsoft domain/Active Directory based networking, and as mentioned earlier Windows XP Home cannot be used in that environment either.
Windows XP Home cannot be supported in the current networking environment, and cannot be used in possible future environments.
The above is the major reason why we cannot support or recommend Windows XP Home in the University environment. Below are additional reasons why Windows XP Professional would be preferred anyway.