I have since given up on this, I tried everything I could think of also, I was dissapointed, so I bought the Wi-fi adapter, but Nintendo hasn't released drivers for Vista so I finally sucked it up and bought a router, works perfectly and it was the same price as the Wi-fi adapter.
There are few things that are needed to set this up. 1. ALFA 802.11g High Power USB Adapter (Model: AWUS036H) 2. Windows XP SP3 Build 5.1.2600 3. Internet Connection Step 1 Using the Wireless USB adapter CD that is provided with the card upon purchase, install the drivers for Windows. The software also comes with a GUI that will allow this card to behave as an access point. Eject the CD after installation and run the GUI that has been installed. Will be named something like REALTEK RTL8187 Wireless LAN utility. From the GUI select Mode and click on Access Point. This will do two things, switch the card to 'Monitor Mode' and also configure internet connection sharing between your Ethernet card and your new wireless access point. Step 2 Click on Config and set up your network. This page will allow you to set an SSID (Network Name), channel that access point will broadcast on and allows to set up a form of security (WPA-PSK/WPA2-PSK), you can also select TKIP or AES for type of encryption. After naming your wireless network, selecting a channel and setting up security click on OK. Step 3 Verify that ICS has been set up by using the ICS tab on this screen. If it is not set up, select your adapter and click apply. After this is all complete leave the software running, DO NOT CLOSE the GUI at all. Step 4 Connect the Wii to your new network. After you have successfully connected the Wii will ask to perform an update and you can choose to update or not. ***Known Issues*** One of the major issues with this set up is that the connection will time out every now and again, so you will need to set up the connection in the Wii to have an MTU of at least 1500 and the Wii will stay connected without issue. Sadly the GUI for the wireless card does not allow you to set up an MTU, so it must be set up in the Wii manually. Also by setting up ICS on your computer, the network will be set up to use the IP address of 192.168.0.1 and will assign the Wii a similar address based on DHCP. This becomes an issue if you use any Motorola products as they have their default gateway addresses set to 192.168.0.1. So make sure that when setting up ICS you do not already have this IP as your default gateway. Lastly, this card tends to heat up just a bit when in heavy use, so do not connect more than one device at a time and you will be a happy gamer. I hope that this is helpful.