Following the Quick Start Guide's instructions on pg. 26, I typed the following into isql:

SQL> connect xnet://employee user sysdba password mynewpassword;

And it responded, thus:

Statement failed, SQLSTATE = 08006

Unable to complete network request to host "xnet".

-Failed to establish a connection.

What should I be doing differently? 

I am on a Mac, if that makes a difference.