Move from Domain to Workgroup
You can login in as Administrator or the user, it shouldn't matter.
Right click My Computer, and then click Properties. Click on the Computer Name tab and then click Change... You can rename the computer to anything you like but the important part is that you change the selection from Domain to Workgroup. You can name the workgroup anything you want. For example, in a small business it may make sense to group all sales computers into the Sales workgroup and all management computers into the Management workgroup. When you're done click OK, it may ask you for a password to remove yourself from the domain. The password should be that of an administrator account on the domain. After that you'll have to restart the computer. When it restarts make sure to log back in as Administrator.
Create New User
Now we have to create a new user. It is possible that a local user already exists under the same username as your domain account so it's up to you it you want to delete that account and start fresh or continue using it. Open the Control Panel again and open User Accounts. Add a new user and by following the screens and when you're done logoff and then log back in using the account you just created.
Load Settings
Click Start, All Programs, Accessories, System Tools and open The Files and Settings Transfer Wizard. Once the program opens click next and select New Computer, click next and it will analyze your computer. On the next screen select the last option, I don't need the Wizard Disk. I have already collected my files and settings from my old computer and click next. Then it will ask you to locate the files and settings, select Other and click Browse... Browse to the folder where you saved all your settings in the Backup step and click Next. The folder name usually contains something like USMT. The program will begin copying your settings over and will then ask you to logoff the account. When you log back in you should have all your settings and files back to normal.
Outlook Email
If you use the Outlook email client (not Outlook Express) and your email didn't make the switch then you'll want to copy over all the files you backed up from the Documents and Settings folder. I suggest restarting the computer, login as administrator. Go into the folder where you backed up your Documents and Settings from your previous account, select all files and folders, right-click and then click copy. Then navigate to your new accounts Documents and Settings folder and paste the files and folders into there. An example using the same names from above: before the switch you backed up c:\Documents and Settings\jsmith.ABC. After the switch you created a new user account called jsmith. This created a folder in c:\Documents and Settings called jsmith. Go into the folder where you backed the old account, C:\temp\settings\jsmith.ABC and select all the files and folders in that folder (ctrl-a), and copy (ctrl-c). Navigate to c:\Documents and Settings\jsmith and paste the files and folders (ctrl-v). When you log back into your new account the email should now be there.
Lastly, you want to setup any programs that may have lost their settings and map any network drives that may have been disconnected.