What do I do with my Time Capsule now?

You can install it in your network.. easy.. and well worth it if you ever need the backup to recover a disk.

There is no slow down because you do not use wireless on the TC.. keep using your current network.

Reset the TC to factory using the reset pin.. hold in for 10sec.

Plug WAN of the TC to your FIOS router or a switch in the network. Any LAN port.

Open airport utility and configure the TC with new short name, no spaces and pure alphanumerics.

Passwords same rules.. but you are going to turn wifi off.. later.

Once reconfigured it should appear on the network.. click on the icon of the TC and make sure you fix up all the issues.. generally a few come up.

Key ones are turn off wireless.

Make sure you are using Off Bridge mode not DHCP and NAT

Static IP on Internet tab.. so it does not change.. this is easy.. just move it from DHCP to Static.. all the numbers will transfer across.

Internet Options you set IPv6 to Link Local Only.

Not necessary but I recommend you go to the disk tab and erase the drive.. a quick erase is fine.. so you start a new backup.

Reset again..

If you start from scratch it should be in the correct configuration.

Make sure WAN of the TC is plugged into the FIOS.

When you do the configuration make sure it is setting up the TC as bridge not router.. that is why you are getting issues with LAN vs WAN address.

Also do NOT copy my addresses.. this has to be your setup which will depend on what address the FIOS gives the TC.

If you still have issues post a screenshot for me so I can see what is failing.

You can do a fully manual setup but you need a direct connection to the TC with ethernet.. and turn off wireless.

Set Airport Utility to use ethernet.

So pull the TC out of the network and plug it directly into a computer with ethernet.

Open the AIrport Utility and the TC should be there.. if not use configure other from top menu,

Type in the IP address.. always 10.0.1.1 after a reset.. no password required.. and do all the steps which I gave you above.. starting from actually setting the name.

The TC must be permanently connected by ethernet to your Network. For most people that means the main router. If you have any switch or other routers in the house it could be plugged into those.