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What about the "Networking" forum answers? :-)
You can still enable WEP or, if supported by the hardware, WPA encryption in your "Ad Hoc" wireless network where there is no Wireless Access Point (or Router) involved.
If you are using Windows XP's own wireless networking software, in the Network Connections folder right click the Wireless Network Connection and select Properties. Click the Wireless Networks tab. You can either "Remove" your existing unsecured Ad Hoc network and set it up again or, for the moment, set up a new Ad Hoc network with encryption using a different SSID. Once you are happy that the secured network is working reliably, you can remove the old one.
Click the "Add" button to configure the new Ad Hoc network. Screenshot - click here
For 64-bit WEP encryption, enter 10 hexadecimal characters (numerals 0-9 and letters a-f).
For 128-bit WEP encryption, enter 26 hexadecimal characters.
For WPA encryption, enter between 8 and 63 normal alpha-numeric characters - you can use spaces and enter a phrase that you will remember.