Switch And Router On Same Subnet?

The ultimate setup thread mentioned only connecting routers together, and it would be cheaper (would it?) to get a new router and a switch instead of two routers of the same type.I admit I don't know much about networking. I tried Googling, but kept getting results about people asking what the difference between a switch and a router is, or how to set up two subnets on one router or switch.My current router is pretty old, its a V2 WRT54GS. I don't want to let it go but the lack of WiFi-n and Gigabit can get limiting, especially when sending large files across systems on a network or streaming video.However, I have another issue that wouldn't really be resolved by replacing it anyway, the fact that most if not all home routers have 4 Ethernet ports max. The amount of wired devices I use in the same area is increasing, and while I can switch some of them to wireless to make room for the wired-only ones, I would prefer not to. Some of these are multimedia or gaming devices and I would prefer the lower latency as well as higher LAN network speeds of Ethernet for them. I was told that I can connect a switch to my router and have everything act as if its on the same subnet.Will devices plugged directly into the router and those on the switch act as if they are on the same subnet and see each other without issue? Wouldn't this cut down on the speed of the devices if I have several plugged into the switch since they are sharing the single port the switch is plugged into the router with? Would it be better to get a switch with several gigabit ports and just plug everything into that for LAN speed? Its not like the WAN connection will come anywhere even close to 100Mbit, much less Gigabit, but would that still cause a bottleneck if several devices are trying to access the WAN over a switch that is plugged into a single port on the router, or no? Or would it be better to plug as many devices as I can into the router and the rest into the switch?

P.S. I use static IPs because I like to know which device has what IP to communicate with them directly if need be, and the WRT54GS has no way for my to reserve an IP based on port, MAC, or anything. Would that cause a problem? Is there any way to assign/reserve IPs on the newer routers (especially Linksys) with their stock firmware so I can switch to DHCP for guest devices?