This article shows you how to set up a static IP address in the computer.
http://www.howtogeek.com/howto/19249/how-to-assign-a-static-ip-address-in-xp-vista-or-windows-7/The example is for the LAN but the same steps apply to Wireless and you would enter your own Subnet Mask and IP address.
The example IP address in the article if applied to you could assign an IP address within the DHCP range and if DHCP assigned that address to another device then you would have a conflict and no Internet connection.
You will need to log into the router and check to see the DHCP range the router uses and then change it so it has a maximum as your range starts from 192.168.1.1 and then you can use one after the max.
e.g. - My own router uses 192.168.1.100 - 192.168.1.199 with the Default Gateway being .254
On that router I have set up a static IP address in the router for my printer at .200 which is outside of the range.
You can also set up a computer with a static IP address within/outside of the DHCP range in the router.
When you set it as an IP address within the DHCP range, it is classed as a Reserved IP address and DHCP will not assign that IP address to any other device, but this does not affect the ISP's external IP address.
This is how I do it in my Billion 7800N but your router will have similar settings and the MAC address is listed as the Physical Address in ipconfig /all.
Where the digits are separated by dashes in ipconfig /all you use : when entering the MAC address in the router.
http://www.billion.uk.com/esupport/index.php?/Knowledgebase/Article/View/268/14/how-do-i-configure-my-7800-series-router-to-assign-a-static-ip-to-a-computer-via-dhcpIf you have any problems then I suggest you take it to where that guy set it up for you, but a static IP address either set up in your router or in the computer should stop the DHCP problem where Windows is assigning that APIPA address - but if DHCP is continually failing to assign your computer with an IP address otherwise, then the router could be goosed or you need to update/reinstall your Network adapter drivers.
Don't use Device Manager to update your drivers as Windows usually only has older ones.
However, before setting up a static IP address, run a cmd prompt as an admin and enter -
netsh winsock reset catalog
netsh int ipv4 reset resetlog.txt
You could also add the ipconfig cmds of
ipconfig /release
ipconfig /flushdns
ipconfig /renew
ipconfig /registerdns
shutdown /r /t 00
Reboot the computer a few times to see if it still connects or if you still end up with loss of connectivity and you have that 169.xxx.xxx.xxx address.