Numerous problems with Airport Express 802.11n with DSL and extending WLAN

Hi all,
I have the following hardware:
802.11b/g Airport Express with firmware 6.3
802.11n Airport Express with firmware 7.3.2
MacBook Pro
iBook G4
Mac Pro PowerMac 2x450 G4
Up until now I had been using the old Airport Express as the base station connecting to my PPPoE DSL line, and it worked fine. I wanted to extend the range of this network, and got another newer Airport Express, the 802.11n model.
First I tried to use the 802.11n to connect to the Internet and the old one to extend the network. Turns out the old one can't be used to extend a network, which is bad enough, but the 802.11n one refuses to connect via DSL for more than a couple minutes, then drops the Internet connection.
So I tried downgrading the firmware to 7.3.0 and 7.3.1, but it didn't help. Did a hard reset, factory default reset, soft reset, nothing worked.
Next I tried swapping the two, putting the old Express back on the DSL line and the new one as the bridge to extend the network (using WPA2). But the 802.11n complains that it can't access the network and flashes amber.
Again, tried upgrading to 7.3.2, downgrading to 7.3.1 and 7.3.0, hard reset, soft reset. Nothing works.
Any ideas?
Cheers,
Fairfax71

I don't see any option in the Airport Admin Utility for the old Express for creating a WDS network, only to participate in one...?
That is the option you want to choose.
You could use the newer AirPort Utility to configure the older AX.
Sorry, forgot to ask something else: The 802.11n Express is able to join the WLAN created by the 802.11b/g Express as a client, but not extend it, is that what you're saying?
No. If you join the network the AX is simply acting as another wireless client and is not extending the network. The "extend" option is not available since the older AX is not 802.11n capable. You must use WDS.
Use AirPort Utiity and follow these steps for both AX's. To set up the main AX:
Click the AirPort status menu in the menu bar and choose the wireless network created by the base station you want to set up as the main base station.
Open AirPort Utility (located in the Utilities folder in the Applications folder on a Mac, or in Start > All Programs > AirPort on a Windows computer). Select the main base station, and choose Manual Setup from the Base Station menu, or double-click the base station to open the configuration in a separate window. Enter the base station password if necessary. If the base station is using the default password of public, you will not be prompted for a password.
Click the Wireless button, and then choose “Participate in a WDS network” from the Wireless Mode pop-up menu.
Click WDS and then choose “WDS main” from the WDS Mode pop-up menu.
Select the “Allow wireless clients” checkbox if you want client computers to connect to this base station.
Click the Add button and enter the MAC address of the base stations you want to connect to this base station. If there is a base station listed that you’d like to remove from the list, select the base station and click the Delete (–) button.
Click Update to send the new settings to the base stations in the WDS. By default, the “Allow wireless clients” checkbox is selected. If you deselect the checkbox, and later want to change the settings on the base station, you must connect to the base station’s LAN port with an Ethernet cable. You will not be able to connect to the base station wirelessly.
To set up the second AX to connect to the main AX:
Open AirPort Utility. Select the AX, and choose Manual Setup from the Base Station menu. Enter the base station password, if necessary. If the base station is using the default password of public, you will not be prompted for a password.
Enter the same network password as the main base station, if necessary.
Click the AirPort button, and then click Wireless. Choose “Participate in a WDS network” from the Wireless Mode pop-up menu, and choose the same channel as the main base station from the Channel pop-up menu.
Click WDS and choose “WDS remote” from the pop-up menu.
Enter the MAC address of the main base station in the WDS Main field. The MAC address is also referred to as the AirPort ID and is printed on the label on the bottom of the base station.
Click Update to transfer the settings to the base station.
This can be found on page 42 of "Designing AirPort Networks Using AirPort Utility" (direct PDF download).

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