The student should be sitting down in front of the computer; your hands should not touch the keyboard or the mouse. Just following this rule drastically improves the student's comprehension in several ways.

• most people remember things that they've done better than things that are described or shown to them
• they're guaranteed to be following where the cursor is, and to know every key that is pressed
• since they're setting the pace, they can stop things to ask questions before they get completely lost
• you'll get in the habit of describing every step explicitly, which will improve both their vocabulary and your teaching skills
• especially with beginners, it will develop basic skills and concepts (knowing which window is in focus, keeping the mouse over open menus, how to drag things and select text, etc.)

The only time you should be touching the computer is when something needs to be done that you specifically do not wish to teach or explain - say you're showing someone who's never used Word how to print a document and the network is down. In that situation, walking them through the troubleshooting process would be frustrating for both of you.

Do provide a basic explanation, along the lines of, "The computer can't figure out where the printer is. This isn't because of anything you did, and it won't normally happen when you try to print something. Have a stretch while I fix it; then we'll start over." (If you must add anything about XP's networking capacities or Bill Gates' parentage, do it under your breath.)