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Re: New router needed.
If you're connecting from XBox to ther router with a cable then I'd go for anything that will take the DD-WRT firmware. I have a WRT54GL which has served me well for years and was extremely reliable once I'd replaced the stock Linksys firmware.
If you're likely to want to connect your XBox wirelessly at any point then I'd be more inclined to go with an 802.11n router. I'm not particularly clued up on what's available in this standard. I would still offer the same advice regarding firmware though - go for something compatible with DD-WRT.
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