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I think for 2-4 PCs a 10/100 network is sufficient still as far as gaming and most every day operations go.
If you think you'll be doing alot of sustained large file transfers, then maybe gigabit would be something to consider.
Yeah, this is mostly a power trip. It will be worth it anyways even if I only do a large file transfer a handful of times. We are also going to be running network wire through the house so I don't really want to do it in cat5 only to have to rerun cat6 later.
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1) The best way in my opinion to share a cable connection is to share it through a router. Im not sure how else you plan on setting this up though?
Well I wasn't sure if there was even another way. I was only asking about the router sharing the internet because if there was a way to share the internet without having to run a second device that would have been preferable. But it's ok, it's the price I pay for being on a power trip.

I don't think there is another way around this.
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Your PCs can talk to each other at gigabit speeds, but your internet would be limited to 10/100 (not that internet needs 100Mbit...).
But what a wonderful world it would be if our internet speeds could do gigabit. (hehe, where is the drooling smiley when you need it)
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This would even be better if there is such a beast as a gigabit router, but I do not know of one (in all honesty I havent really looked...)
I have checked around a few places and have yet to see one, even on the manufacturers web sites. I don't think they make them either.
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3) I think it'd be an interesting idea to set up a linux box to run firewall services, it can be done pretty cheaply too. Otherwise just make sure you run a good software firewall on all your machines.
If only I was a little better at what I do this box would be a linux box but sadly I will probably be setting it up as a windows server box instead. I tried to install Linux before and it didn't go that well. I know unix well enough to enter commands but I am unfamiliar with the layout in Linux (where it's file settings are stored etc). The good thing is when I go to this new house I will actually have an extra PC there so maybe I will set it up as test and try to get the linux working properly.
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Hope that helps.
You have helped a great deal though. Thank you very much for your assistance.
- Bill Junior