Check the cable first. It could be something as simple as a short in the cable. When something dies, and you have no idea what, rule out possibilities in order from cheapest to most-expensive.
As for securing your wireless connection, two things manage this very well: enable WPA-PSK encryption (not WEP, WEP can be cracked in under a minute), and disable SSID broadcasting. At least enable WPA-PSK.
EDIT: Ideally, the larger your WPA-PSK passphrase is, the better. Common rules for passwords apply here.