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The title pretty much says it all, but here are more details.
I'm using 'Internet Sharing' on my iMac to share my hardwired connection w/ my house. Can I buy an Airport Express and use it to extend my network or will it only do WDS w/ another Airport Express or a proper Airport Base Station?
For a lot less money you could buy a decent wired router and provide a wireless connection throughout the house. Plus, you wouldn't need the iMac on all the time so other people could connect.
WDS tends to be tricky when you use more than one vendor's hardware, but it should work with all the same vendor's equipment. It's just not the most efficient (nor least expensive) way to go.
Also, if you get a wireless router like ghporter suggests, you could position it in a more central location to provide better coverage throughout the house. That is, assuming you have a phone/cable outlet in the appropriate area.
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