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Can I have security enabled on router AND XBOX Live working?!
OK - then you're unlikely to have OEM firmware incompatibilities.
All I casn suggest is that you have both your router and adapter set to exactly the same encryption, i.e check bot hset to WPA and both have exactly the same passkey.
If that doesn't work try them both in 128 bit WEP, the if no joy try 64 bit WEP.
Also ensure MAC filtering is set up to allow the adapter to access the router.
Finally if all that still doesn't work all I can suggest is, if you haven't already done so, to update both the devices with the latest Netgear firmware version and try again.