Unfortunately, I don't think you can mix and match encryption schemes on any wireless device. You'll either have to set everything to "wireless equivalent privacy" (WEP) at 40 or 64 bits (they're the same thing, but just stated differently-honest), or give up on the device that only supports 40 bit encryption.
What is the new device, anyway? It may be that there is an update of some kind that will allow it to run at 128 bit encryption.