WiFi and Security Questions

[Dravyk]

Interested in setting up a wireless network in my home. Problem: I'm in a residential area (Philly) with closely grouped houses and concerned about security issues.

There's literally too much info on the Net on this topic (search engine overload) that I've not been able to find what I want about this, ergo this post.

Questions:

1) We hear more and more about WiFi security breakins, downloads, controlling one's computer, identity theft, etc ... is this a case where the security is not there, or the old case of the security is there but most individuals and businesses don't do something relatively easy and necessary?

2) If it's the latter, what should I know? What wireless LAN config/hardware do you use? (And are you in close metropolitan area or have lots of space between houses?)

3) I hear there's different Mhz frequencies, and that the higher is better, but it's newer and costs a lot, true? What's the best to use in my situation?

4) While we're on the subject, what about those public wireless areas. I have the same concerns, can't someone see what's on someone else's laptop in those situations?