The security on 802.11b networks, even with "strong" encryption isn't that good. With a fast (eg, Pentium-4) laptop, the right network card, running Linux and the right "wardriving" software, many 802.11b networks can be cracked and then hijacked. In older 802.11b network gear, all the attacker needs to do is log enough of your traffic and have a fast enough CPU to reverse-generate the WEP key.

The weaknesses aren't just in the crypto itself, there are also weaknesses are in the key exchange, etc. The whole 802.11b crypto infrastructure wasn't well thought out and wasn't reviewed by hard-core crypto people before it was put out into the field. When 802.11b gear was deployed, the hard-core crypto researchers found vulnerabilities and wrote up exploits within the first several months the specification being used by manufactures. It was really embarrassing for the computer networking industry. Here's a quick summary that isn't super-technical:

http://www.isaac.cs.berkeley.edu/isaac/wep-faq.html

Here are some links to show you the tools used to detect AP's, then recover the key(s):

http://www.netstumbler.com/faqs/general/

http://airsnort.shmoo.com/

http://sourceforge.net/projects/wepcrack

I should add that one of the favorite tools of "wardrivers" (people snooping around, looking for wireless networks) is the "cantenna" -- a highly directional antenna made out of a Pringles potato chip can. So if you see someone sitting outside your front gate waving an empty Pringles can around outside their car, maybe you want to help them move their car with your tractor. ;-)

OK, so what do you do?

First, make sure you're using WEP. About 30 to 40% of all AP's out there still aren't using WEP (wired equivalent privacy) encryption. As the above links point out, WEP has its problems, but not using WEP is just plain silly.

Then examine the techniques recommended here:

http://www.netstumbler.com/2002/01/23/best_practices_for_wireless_fidelity_network_vulnerabilities/ 

Second, if you're really concerned about someone cracking your WEP key, one of the techniques used to add on extra security to 802.11b networks is the dynamic password generation system. If you keep rotating through a series of passwords, you can increase the workload of someone trying to capture enough traffic to re-generate the key. If you change the key frequently enough to not give them enough traffic using one key, you'll perhaps even prevent them from being able to re-create the key. There is software available out there to rotate the AP keys and client keys in sync through a "ring" of WEP keys on a regular basis to make cracking any one of the WEP keys less likely.

Another solution is to convert your wireless network over to an all-Cisco network. I'm not just saying this because I used to work for cisco -- the cisco "LEAP" protocol is a substantial improvement for 802.11b security. Sadly, because of the way standards organizations work (in this case, the IEEE), it is very difficult to get a standard developed, adopted and deployed rapidly in response to security problems in a previous standard. So cisco decided to "go it alone" and just get the holes closed up, without going through the IEEE standards procedures. 

Crypto keys, all crypto keys, become weaker the more you use them. The more data you encrypt with any one key, the easier it becomes to try to mathematically re-create the key.