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Originally posted by derien: It might also be wise to limit access through the router to the specific MAC addresses of the computers you are using. Each network card (whether wired or wireless) has its own unique ID, so in theory (and pretty much in practice, I would guess), that would prevent unauthorized access--but the encryption would still be necessary to prevent evesdropping on the wireless connection. The process for setting this up will be specific to the router, so you should have a look at the manual or documentation. I should note that I'm not an expert in this area, so someone correct me if I'm wrong on any of these points. 
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Yes, this is a very good suggestion too. It is relatively easy to clone a MAC address and then muck around on a network, but once again it is a deterrence. If you look at network security much like home security, you're heading in the right direction.
If someone really wants in, only a pro is going to stop them. On the other hand, if you can make your network far less attractive, they'll go hack someone else's down the street.
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If you have 128 bit WEP available on every machine, then use it, it does take relatively longer to crack than 40 bit. If you don't 40 bit is fine, it's still better than nothing, and means someone over the corridor in a dorm, or in the next townhouse along or whatever can't accidentally use your network.
Howard makes a great point about turinging of the SSID broadcast, creating a closed network etc. If there are any options on the setup of any wireless kit that look similar to these, set them. Another obvious basic step, is to change the default SSID. Quite often, it's "airport" or "default" or another well known string. There's no point turning this off without changing it. Don't use your street name or house number here either, because that will tell drive by sniffers exactly where they can get the best signal
I think tech.tv are planning on doing a series on security of home wireless networks sometime soon, so have a looksee at their website.
Cheers,
Ben.