I am helping a friend set up a wireless network with a pc and a laptop. He currently has dial-up access through MSN. How would I do this? Would he need an external modem connected to a router? or would going with a DSL or Cable be the easiest way.

Going with an always-on service like DSL or cable is going to be better, basically because it's faster, if you can pay the premium. I like cable because it's not connected by telephone lines. And it is a little easier to set up than dialup. However, you are going to need to state what O/S you are running before someone can help you set up for dialup.

The pc is running windows 95 and the laptop is running windows XP.

Well, I had a solution but the product may not be avalable any more. 3Com made a dialup router that had 4 ports on it. you configure it to dial the isp with your user name and password and it retains connection to whatever length of time set in the setup. Even indefinately. To the router attach an access point and you are set with wireless through a dialup connection. Op sys doesn't matter. I couldnt find it on the 3om site. Ours is model 3c886. Surely other companies must make a similar product.

http://www.multitech.com/PRODUCTS/Families/RouteFinder/

I´m only suggesting a router. In theory, you should be able to do this with any lan topology. I know that windows lan allows for dialup because it allows you to dial up a connection from a machine connected to the machine that has the portal. However, I have just never done it. If you have a dialup with more than one machine, you aren´t going to like the wait. However, if you are adamant about doing it, it can be done.