I used to have the same router. It'll work fine with that setup. When I originally started using wireless, I had no problems with lag. The only issue would be loss of connection due to interference. For that reason, I also have my Xbox hardwired while using wireless elsewhere.
In terms of performance, you should see no problems with lag over a wireless connection. The signal simply doesn't take that long to process. Bandwidth is also not an issue since you don't need anywhere near what a 802.11g router can do.
If you have any questions, feel free to let me know. I'm a networking major at school and a CCNAso, while not an expert, I do know something about the subject.
Also, for reference, my old wireless connection was over 802.11b and the interference was coming from a 2.4gig spread spectrum cordless phone. Almost every time I picked up the phone, I lost my wireless connection.
SergioP
I know someone that is having that same exact problem. One way to fix it is to either switch to a cordless phone operating at 5 GHz or change the channel on the router to either 1 or 11. That SHOULD fix it.
Oh and to the OP...you should be fine as everyone else stated.
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