adhoc wifi for ppc Ipaq H4350

[sparky1010]

I'm having a bit of trouble attempting to setup my pc as a way to get on the internet through my ppc (iPaq - H4350 - Pocket PC 2003 Premium). I have read the stickied post on how to set this up. I've turned on my wireless card on the pc. I've set it up as an Ad-hoc with an SSID (no wep yet). I go to share my LAN connection and it states that it wants to change my IP to 192.168.0.1 (I believe that's the ip). I have my desktops set up with fixed ip's, the router still has DHCP on (it always has worked this way - some say to turn off dhcp when you assign fixed ip's to your desktop). The outcome of this is that the pocket pc seems to connect to my desktop's wireless. It even gets an assigned ip of 169.254.x.x. NOw i didn't realize that I had to wait 30 seconds for it to get the correct ip. I did, however, attempt at accessing the internet several times within a half hour with no luck. I'll summarize all this info below.

Windows XP Service Pack 2
Router address: 192.168.1.1 (Linksys) DHCP on
LAN Card intial setup: fixed ip 192.168.1.90 / gateway: 192.168.1.1
LAN Card final setup: ICS states that it will assign it an ip of 192.168.0.1
Wireless Card setup: use DHCP to automatically assign ip. have Ad-hoc setup and SSID name entered. No WEP yet.
H4350 PPC 2003 Prem. setup: Connects to adhoc wireless network. the only assigned ip so far is 169.254.x.x. Is not able to connect to the internet.

I spent nearly 2 hours last night trying to get this to work. No luck yet. Has anyone run into this problem? Thank you for the help!!!