Is my ISP just trying to make a buck?

Okay, I have an iBook G4 that until yesterday was running Panther 10.3.9. I have DSL through AT&T but my iBook isn't connected directly to the modem but via wireless through Airport. After I installed Leopard 10.5 my network connection was gone. To make a long story short, after 3 phone calls to AT&T, I am now connected to my network, but I hardly have any signal. They had me boost the signal on the router to as high as it could go, but even now as I'm sitting the room right next to where the router sits I only have 2 bars on my Airport logo thingy, and if I go right upstairs to my bedroom I have no signal whatsoever. Call me crazy, but that kind of defeats the purpose of having a wireless connection don't you think? According to AT&T, our modem/router is ancient (it's about 3-4 years old) and that we need to buy a new one. Is this a possibility or is AT&T just trying to make some money off of me?

The simple way to test modem/router speed is to remove wireless from the equation. If you get good speed tests while cabled through an ethernet port then the problem is obviously the wireless connection which you say is via an Airport. Nothing an ISP can do here.
If it's a wireless speed problem, then there are still two ends to consider. Try your laptop on someone else's wireless router, even if it's a coffee shop. No problem? Then your wireless router has a problem. If, on the otherhand, you don't see any improvement, then it's the laptop (hardware or drivers or setup).
You are not going to get anywhere by calling an ISP who is always quick to blame everybody else, and the same goes for the hardware vendor who won't accept the blame either. You have to change something in your setup, and see what makes a difference.
If you provide a little more information about your hardware, like the DSL modem name and model, and the Airport model and firmware info it might be a little easier to assist you.
In reading and re-reading your message, I'm not clear if you have a DSL modem connected to an Airport router or a DSL modem/router connected to an Airport router, or a DSL modem/router connected to an Airport that's been setup as a wireless access point. Daisy chaining routers can cause issues also, but it appears that your main problem is the wireless signal strength and you don't know if its the sender or the receiver or even related to Leopard.

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