We used a PhoneNet adapter between the old LaserWriter (see photo in
this article) and the iPrint. It has a serial cable on one end and one or two RJ11 phone jacks on the other. You also need one on the computer. These would be required even to set up a pure LocalTalk network. The iPrint is the connection/conversion point that enables stepping up to Ethernet.
If you have the PhoneNet adaptors with two RJ11 ports and don't use both ports, you must install a little terminator in the unused port or things will not work. The terminator usually comes with the PhoneNet adapter but may not be included in a used one. Here's a new one offered with the terminator included:
http://www.welovemacs.com/fastnet.html
The eBay listing you reference does not indicate if that adapter is the LT or the one for a StyleWriter. Contact the seller for clarification before bidding on it. The StyleWriter version is not the one you want unless you need to network a StyleWriter.
Here's an article on Mac networking that includes discussion of LocalTalk:
http://www.smalldog.com/buyguides/networkprimer.html