Linksys Router Befsr41 V3 With Latest Firmware 1.05.00 - Limited Or No Connectivity?

I have a linksys router(befsr41 v3) with the latest firmware(1.05.00) - i have been using it for at least 7 or 8 years now - at one time i had 3 computers hooked up and they all three worked fine. Now i have 2 plugged into the router - both are xppro machines - the one i am on now works with no problems. The other computer however has the limited or no connectivity problem.I used this router for years without any problems then one day this ip conflict message started to appear.

I started getting this ip conflict message on both computers but only occasionaly - it never caused any problems - if you ignored it - it would simply go away.Then one day computer #2 got the limited or no connectivity message - i simple reboot fixed it. This solution worked several times. Computer #1 has never had any problems with the internet connection.Sometime later the limited or no connectivity problem reappeared and this time a reboot did not work - i searched for a fix and decided to try changing the link speed from auto sense to 10mb half duplex - this solved the problem. This solution worked several times.

Sometime after that the limited or no connectivity reappeared and after some searching i upgraded the routers firmware - this solved the problem.Sometime later the limited or no connectivity reappeared and this time i had to actually uninstall the NIC, reboot and then let it redetect the NIC and then the problem was fixed. This solution worked several times.Sometime later (wich brings us to 3 or 4 months ago) the limited or no connectivity reappeared and this time after searching for a fix i was able to fix it by updating the NIC drivers. Problem solved.

This brings us to now - the limited or no connectivity has reappeared and none of the previous fixes correct the problem.When i originally set everything up it worked immediately out of the box.DHCP is enabled - everything is set to obtain an ip address automatically.At first the event viewer on computer #2 reported The IP address lease 192.168.1.100 for the Network Card with network address 0xxxxxxxxx has been denied by the DHCP server 192.168.1.1. {The DHCP Server sent a DHCPNACK message}.

Now the even viewer just tells me it is using ip address 169.254.xxxxxx

I have tried all of the previous fixes to no avail. I've tried shutting everything off and turning everything back on - i've tried resetting both the modem and the router - i've tried upgrading the firmware again. I even downloaded LELA and installed it on both computers thinking maybe it would detect and fix the problem buy no such luck. LELA simply tells me that computer #1 is working normally. On computer #2 when i installed LELA the first thing it did was try to find the router and it tells me it cannot find it.
I tried uninstalling the NIC and removing the drivers, rebooting and then reinstalling them. No luck.

I tried setting a static ip on computer #2 with no luck. When i did these two error messages appeared in the event viewer of computer #1---

The master browser has received a server announcement from the computer (computer #2) that believes that it is the master browser for the domain on transport NetBT_Tcpip_{0876E9A8-C6E. The master browser is stopping or an election is being forced.

The name "MSHOME:1d" could not be registered on the Interface with IP address 192.168.1.100. The machine with the IP address 192.168.1.20 did not allow the name to be claimed by this machine.

If I ping the router from computer #2 it comes back 100% loss.

If I ping the NIC it comes back 0% loss.

I might also add that I can see both computer #1 and #2 in my home network workgroup on both computers. I've tried ipconfig /release and ipconfig /renew - I've tried it one after the other and also a reboot in between. I've tried clicking on repair in the LAN status - I've tried resetting the ip stack with the netsh command - I've even tried different cables and switching ports on the router.