Wireless Router Issues

[zim2411]

At Philadelphia we had our scouting system up and running for everyone to use. We constantly ran into issues with our router crashing however. We used a Linksys WRT54G with dd-wrt firmware. Stock settings are to hand out 50 dhcp addresses, which we hit midday Thursday I think. I upped it to 250 maximum users, but we started running into issues with the Wi-Fi just dropping out of existence (no one's device could find it). We had a few things hardwired into the router, and they continued to function normally. We had about 70-80 DHCP entries around this time.

Is the issue with the router handling too many DHCP users? Would running the DHCP server on a computer behind the router, thus making the router function only as a access point/switch? Or can a WRT54G absolutely not handle this traffic load?

Is there any wi-fi system that is more powerful?