Wireless is easy to setup and secure. The main thing you need is an access point, most have a 4 port router built in as well. Once you have that, then you just need cards for each of you computers you want to connect, if your laptop already has an internal card then you wont need anything additional for it. My thoughts on wireless is different than most peoples. I leave mine wide open (and wish others would do the same). The reason being is how nice would it be that you could get your email on your PDA or laptop anywhere you can get a signal? Or pull up driving directions anywhere you get a signal? Or...the list goes on. Just be sure to secure your machines with botha harware firewall and a software firewall. Wether you have your Wireless secured or not you should still use both levels of a firewall. This will protect your personal files for most people. One thing is, if someone want to get in to your system they will get in, PERIOD. Thats the number one thing that is taught in most security classes being prepared for when that happens is what you need to consider. To enable it so only you and your neighbor can connect you should probably do a couple things. If you want it secured do that and only you and your neighbor have the key (it would prolly be best to setup your neighbors so only you have the key). Thats the firsty, the next is to do mac filtering and only allow your mac address and your neighbors mac address to connect. This will keep everyone but the most determined people off your network. As long as you dont share your computer on the network your neighbor will not be able get to any of your files. Now if you wanted to share certain things you can setup a single folder thats shared so anything in that folder is accessable by anyone on your network.
Wireless will not slow your connection at all. Even the slow wireless (802.11b) is still 11mbs. You connection is most likely 1.5mbs (could be faster, but I dont know of a reasonably priced solution in our valley that is faster than 11mbs). The faster wireless is 802.11g and its 54mbs...they are now developing faster technologies too. Even if you are maxing your connection out at 1.5mbs (or whatever it is) you will not be limited by your wireless on the internet. The only place you may notice a slow down is on your local network. If you are transfering between two computer on you network a wired network can get speeds as fast as 100mbs, while (as I pointed out above) wireless is limited to slower transfers. If possbile I hard wire my computers, but sometimes wireless is a good solution. I do transfer a lot of larger files because I have my server that I host all my files on.
Being limited on speed becasue more computers are connected is determined by your ISP. With cable I know you are limited to XXmbs and no matter how many compters you have on your line you wont get faster than that. DSL (depending on provider) may be different.