|If you want the upstairs WRT54G to be using the same WiFi channel and on the same network as the downstairs WRT54G, it won't work. You will be creating 2 WiFi access points which will be operating independently but trying to do the same thing. They will conflict with each other. What you are describing is 'extending' the range of your home WiFi network and you need to do that with a "range extender" which is a WiFi repeater in conjunction with a protocol called Wireless Distribution System (WDS) which will sync the 2 wireless access points and allow them to work together instead of in conflict.|
You could use the upstairs WRT54G to set up a 2nd network and wireless access point by simply connecting the WAN port of the upstairs WRT54G to one of the LAN ports on the downstairs WRT54G and use a different network or subnet and broadcast the WiFi on another channel. Computers in the house could access the Internet from which ever access point provided the best signal, but the computers on the different networks couldn't communicate with each other unless the networks were bridged.
Cable modems typically only allow a single connection, you probably can't connect both routers to the one modem at the same time.