Does the newest Airport Express not serve ethernet port internet?

Question

I have DSL to my tower with an 802.11N Airport card, I used the Airport Utility to 'make a new network' with an Airport Express 802.11N connected to my home theatre, and it works fine streaming iTunes.
The cable co. makes you register the MAC address of the machine that will be served by the DSL modem, and allows up to two other addresses if phoned in otherwise any other MAC address attached direct to the DSL will not get a signal.
I have made the network 'closed' and WEP2, then used the MAC address exclusions in Airport Utility to add a bit of extra protection.
Under this set up I was under the impression that the tower would still serve DCHP addresses wirelessly to the Express to anything that knew the network name and password.
The previous generation of Express used to be able to allow you to plug in a PDA with an ethernet card and be serving the ethernet, what is the problem with continuing that on the newest version? I see no point in being tied down to where ever the cable co. installed the modem just to use my PDA on the net, or cart the tower around the house to PDA connect to.
The stupid Express was a great solution for that previously...walk to a wall socket plug in establish the network and connect something to the ethernet port.
With previous Airport Utility software it was fairly clear as to whether you have turned on the ethernet port of the Express to serve an internet connection, with the latest AU software it is not.
I CANNOT serve any DSL signal through the Express no matter what setting I have tried. Turning off the firewall settings, MAC addy exclusions, 'closed' network to open, and attempting to reset the Express with something other than the bridge configuration makes no change (or functional) signal service to the Express.
I even imagined I would have to go through System Preferences and turn on Internet Sharing (sub selections, Share your connection from: "Built-In Ethernet" and further selection "To computers using: Airport"
The only thing I didnt try tinkering with was the Web Proxy (HTTP) protocol selection as Glimmerblock uses that to help do its job, but that also doesnt make sense to downstream blocking the ethernet port from serving a web connection.
If I try the other Simple Setup selections under AU software, I royally lose detection of the Express and otherwise does not do any favors for making this work. Someone here told another person to use the setup assistant chosing "Join existing network" but thats wrong, the tower cant make the network with just the Airport Card alone, it needs the Express available to 'make a new' network... you cant even access any panels of Airport Utility without the Express being reset and ready for programming with the AU software.
Is there a way to make the port serve outgoing internet signal grabbed wirelessly from the tower?
Mucho appreciato if someone could suggest what is up.

Answer 1

No no, not an unsecure network, Im saying once the basic Assisted setup was followed in the previous OS 10.4 for Airport, you could go back in manually and set things to WDS which supposedly was the only way to go CableModem~Tower~Airport to Express~out express ethernet port to wired only machine.
Ive tried doing it that way for this newer Airport Utility and its frustrating as blankity, the only way to make a wireless network is between the tower's airport card to the express, you cant make just a network with the built in Tower Card at all. Then you could force the express to join it, otherwise it wont work.
I tried the WDS Main/Remote/Relay settings both ways with the Airport ID addresses for the tower AND express, switching them hoping one works, all I get is infinite loop of having to reenter the airport setup password when the express is updated and rebooted.
It wasnt this intricate before, is all Im saying. All it took was setting to WDS mode after going thru basic setup, checkmarking the box, updating the unit, restarting and there, the express served the wired client through the ethernet port.