On a Windows XP system the hosts file that is relevant is always under
\Windows\system32\drives\etc .
The hosts file to edit is called hosts and nothing else.
The file is a address to IP translation file and Windows looks there first before it searches on the Internet for a host´s IP address. If it find the address in the hosts file it stops looking.
One good example of using the hosts file is to block access to web sites.
An example:
http://www.adpage.com 127.0.01
When the above line is added to the hosts file, every time the system tries to go to
http://www.adpage.com it tried to go to 127.0.0.1 which is LOCALHOST and it´s actually always your own computer. Since you probably don´t have a web server running on your computer, it wil fail to open any web page. If if had, the start page on your web server would open (if a web browser was used of course).
In the case of this line,
222.111.150.111 gwgt1.joymax.com
It helps if the game have problems finding the address using DNS (Internet server for address to IP translation) since it will find the answer in the hosts file. If however the address of gwgt1.joymax.com changes then it prevents the game from reaching the correct address.