I am having trouble adding my "Network Connections" folder or items within this to the popups menu. I have read through pages and pages of litestep documentation and cant find where it says this.

Either having
*Popup "Network Connections" !PopupFolder:"{7007ACC7-3202-11D1-AAD2-00805FC1270E}" did not work and neither does:
*Popup "ISP" {7007ACC7-3202-11D1-AAD2-00805FC1270E}.{BA126AD7-2166-11D1-B1D0-00805FC1270E}
(the string found in the target section of a link to the ISP) also does not work.

Can someone either give me some hints on how to do this or direct me to some documentation which covers this?

Thank you.

Try pointing the popup to the .lnk shortcut you mentioned.