Fax Software

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Have you tried setting WinFax PRO to use Class 2.0 ?
I would recommend using Class 2.0 over Class 1 when the modem supports it. The USR Business Modem does support Class 1 and Class 2.0

Using a VirtualPC is not recommended, so I would try this on the PC if possible. If the faxes are getting stuck when using Com1, you might have some other device using the modem via TAPI, such as RAS (Remote Access Server) or there is some other com port / modem conflict. I would recommend leaving it set at TAPI mode.