Accessing xp share drops both wifi connections

Here's a weird one for you experts.

Background: I have an XP pro x32 machine on wireless with shared folders, a 7 Ultimate x64 machine (fresh install) on wireless, and Linksys Wireless/wired router (I'll get the model number later, can't remember). I've had the shares on xp set up for a long time and never had an issue with them on XP or Vista machines. The two machines are on the same router, same subnet, same workgroup (home), individually assigned IPs, and can access the outside fine. 7 does not have a "share group" set up.

Issue: Whenever I access a shared folder from the 7 machine it connects fine until I start to transfer files. It will make it anywhere from a few seconds to a couple of minutes before the wireless connections on both machines are dropped. The connection problems only happen when copying shared files; I can browse shared folders or internet all I want.

I've been through the How-to-share tutorials but no change. Any ideas what to try next?

Side note that may or may not have any bearing: I had been having an issue where the wireless adapter didn't exist (device manager or anywhere else) after coming back from sleep. That required me to reboot to see it again. I fixed it by disabling the save power feature on the driver and disabling sleep mode.

might be worth a look at a small program called "Net Stumbler" it will show if there is another network using the same frequency and channel number
In the share make sure "everyone' is in the share group and your permissions are set up on each share

I'll check the frequency/channel but the security and sharing permissions are fine. Even if it was on the same frequency/channel as another network, I don't understand how it would only drop the two connections when attempting to transfer between themselves but leave browsing fine for extended periods.

edit - could the router firmware software or firmware be causing it? Not compatible with windows 7? Also, what about some sort of ip4 vs 6 conflict?