There are three common ways to share an internet connection using a
cable or DSL modem.  For a 3-PC setup, these look like:

1. Cable/DSL<==>Modem<==>Hub/Sw<==>PC-1  ; each PC plugs into a
                               <==>PC-2  ; LAN or downlink port of
                               <==>PC-3  ; the Hub or Switch, and
                                         ; the Modem uses the WAN or
                                         ; uplink port

2. Cable/DSL<==>Modem<==>PC-host<==>Hub/Sw<==>PC-client1
                                          <==>PC-client2

3. Cable/DSL<==>Modem<==>Router<==>PC-1  ; each PC plugs into a
                               <==>PC-2  ; LAN or downlink port of
                               <==>PC-3  ; the router, and
                                         ; the Modem uses the WAN port

(1) gives each PC a direct connection to the 'net, but it requires
    the ISP to issue a different IP address to each PC.  Many ISPs
    charge extra for multiple IPs.  Also, those different IPs may
    not be in the same subnet, so the PCs may not be able to easily
    share files or printers.

(2) requires one PC (PC-host) to perform software routing (using ICS,
    which is part of XP, 98SE, and ME) for the client PCs.  Free, but
    the client PCs cannot get to the 'net unless PC-host is running,
    so this configuration is not as robust as (3).  If there is only
    one client PC, a crossover cable may be used instead of a hub or
    switch; a crossover cable is equivalent to a passive two-node hub.
    Note that the host PC must have two NICs: one on the WAN-side to
    the Modem, and one on the LAN-side to the hub or switch.

(3) uses hardware-routing; a router is cheap but not free.  A router
    is usually more robust than a solution based on ICS because it
    runs a simpler OS than Windows and because it is dedicated instead
    of shared with other Windows apps.