Wireless G+MIMO Router setup - can't get it to route traffic

I've just bought a Wireless G+MIMO Router (in the UK). It's attached to
an ADSL modem/router and I already know the ADSL modem/router is working
fine (it's a Draytek Vigor2800V btw).

Quick note what the ADSL router setup is: we have a static block of WAN
IPs assigned to us by our ISP with the network X.Y.Z.137/29. Hence we
have use of the public IPs X.Y.Z.137, X.Y.Z.138, X.Y.Z.139 (and so on to
142). The ADSL router is in static routing mode, i.e. it is not doing
any NAT. As a test, I can attach an XP box (with XP firewall on!) to the
ADSL router, setting the XP box's network up as follows:

address: X.Y.Z.138/29
Gateway: X.Y.Z.137 (i.e. ADSL router)
DNS server: X.Y.Z.137 (i.e. ADSL router)

and then XP networking works fine - I can resolve addresses (DNS
lookups) and reach the internet fine. All good.

So, the Belkin side of things - I am attaching my Belkin Wireless G+MIMO
Router via the Belkin's uplink ethernet port to the ADSL router, and
setting up the Belkin router as follows:

WAN Address type: Static IP
WAN address: X.Y.Z.139/29
DNS and gateway: X.Y.Z.137 (i.e. ADSL router)

I've set up the Belkin to be a DHCP server on the LAN side, giving out
addresses in the network 192.168.74.*. I've attached a PC (wired) to one
of the Belkin's LAN ports and that PC does get given an address via
DHCP. However, that PC cannot do any DNS lookups or ping/reach any host
on the Belkin's WAN side except for the ADSL router itself (X.Y.Z.137).

Now, my first question is: have I defined the right sort of WAN address
type on my Belkin? I have it set to Static IP which looks correct to me:
I just want it to have a set IP address. I'm just a little unsure about
the WAN address mode because the other modes are things like PPoE, but
this Belkin isn't an ADSL modem, it's a wireless router, so why should
it have to potentially know about PPoE?

ALso, if the Belkin's WAN address type of "Static IP" is correct, can
anyone clarify to me the significance of the checkbox "My ISP has
assigned me a block of IPs"? I've tried selecting this checkbox and then
put sensible seeming values in the fields that appear, but that doesn't
help....