When you create a wireless network with two or three computers and you don't use an Access Point, the network will operate in peer-to-peer or ad-hoc mode. However, if you have more than three computers, your network needs to operate in infrastructure mode: you need an Access Point.
Having an Access Point will allow you to increase the distance between your computers without losing the connection. Each Access Point supports up to 20 computers. You can plug it into your broadband-connected computer, and share your high-speed Internet connection with all of the other computers.
You can improve the flexibility of your network if you connect it directly to a router. By doing so, you are no longer dependent on any one computer for firewall protection or Internet access.
Better yet, combine the two devices and get a USRobotics wireless router! It's like 4 products in one: wireless access point, router, 3 port Ethernet switch, print server. A wireless router gives you maximum flexibility, performance, and functionality:
How do I connect my gaming console to my network?