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Great, thanks much konut. I knew you needed to install Slimserver but I thought this was only the software to manage the audio files, I didn't know Slimserver was also acting as the "network manager"!
It's not. The software contained within most home routers that doles out IP addresses is called a DHCP server. You don't really need it, as you can manually assign an IP address to the Squeezebox instead.Another issue of running without a network router is in accessing the Internet from the Squeezebox. If you'd like to use their SqueezeNetwork service, in which the Squeezebox connects directly to an Internet radio feed, then you'd need to configure your PC as a router (often called "Internet sharing" in Windows). If you don't care to use SqueezeNetwork then don't worry about it. You can still connect to streaming 'net radio through the SlimServer running on the PC....
Bottom line, I think I have the flexibility I need with the SB. I can connect it wireless and when I get frustrated with signal loss I can just swing the ethernet cable straight in my portable PC.
May be a good plan. I run two Squeezebox2s wirelessly without a hitch, though, and almost never get a dropout. If your wireless router contains a switch (multiple ethernet ports for attaching computers, devices, etc.) as most do, that would probably be your better fallback strategy and would be every bit as reliable as a direct PC->SB connection. If I'm not mistaken, it would require a bit less reconfiguration on the Squeezebox to switch between the wired and wireless connection if you kept it on the router.