if i go to devices and "Install Guest Additions" it says the iso must be downloaded.
Does that mean my Guest additions aren't working right?
If you haven't installed the Guest Additions into the VM previously they just won't be working.
I believe you have an XP Guest? If I remember, if you had GA's installed it should show up in your XP task bar.
If you have the GA iso on your host machine try opening the Virtualbox Virtual Media Manager and load the iso in the CD/DVD section and then restart your VBox XP Machine.
If you don't have the GA iso, download it (same version as your Virtualbox) and then load it using the Virtual Media Manager mentioned above.
Once it's loaded XP will be able to install it.
For your shared folders, please follow as
sound advice listed above.