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As long as you don't have extremely sensitive data then using the available security measures (WEP, MAC filtering, Password protection, Disabling DHCP etc..) will suffice. With a three story house your primary concern is going to be coverage. Depending on the makeup of the construction you may end up getting a second AP. Router/AP combo at your broadband connection, and then cabling from one of it's LAN ports to the second AP. The only way to know with wireless is to test. Every environment is different. If copious amounts of data is tranferred regularly you might consider the D-Link 802.11b+ hardware. With there AP's you can put them in repeater mode as well. That would mean you could get away with the second AP not being cabled to. The only caveat there is that each hop cuts your effective bandwidth in half.
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