Linksys WRT54GS for WAP?

The IP address and subnet mask for the WAP don't really have any impact on how it works*; they're just used for configuration of the device.  You can set it as something in the 10.101.x.x range and just remember that your computer has to match the first three bytes of the IP address so the (annoyingly limited) subnet mask doesn't get in your way when configuring the WAP.  You may be having trouble changing the address because the web interface stops working once you save the new one.  You have to change your computer's address to match the new WAP address, then point your browser at the new address as well.

*This statement is only true if you disable DHCP on the WAP.  It's generally better to let your Ion console act as the DHCP server for the system.

I was under the impression that if they are on different subnets, the two devices can't talk directly to each other and that can hurt performance.  Am I wrong?

-Tim

Yes, obviously I have the DHCP server disabled on the router.

No, you're not wrong and that's definitely the best practice...

...but sometimes you can cheat.  The subnet mask is only used internally by a device to determine whether another IP address is on the same network.  If, for example, your computer is set to 10.101.1.250 255.255.0.0 and the WAP is 10.101.1.1 255.255.255.0 they can actually talk to each other.  The wap sees 10.101.1.x in the computer's address and thinks it's on the same network, while the computer sees 10.101.x.x in the WAP's address and thinks the same.

It's not great as far as ideal system design, but it works for your unusual situation because adjusting settings in the WAP is not a very critical function.  You could instead change the settings on your computer to match the WAP for the times you do need to talk directly to it, but that's kind of a pain to remember.  Really, you could pick any address at all for management without it having an effect on the normal traffic passing through it.