Have you found the solution? I am having the same issue. When I run OSX 10.6, I could use "internet sharing" to connect my music player to my macbook via wifi without actually connect my mac to the Internet. However with OSX 10.7 Lion, "internet sharing" requires actual connection to the Internet. All I need is to stream the music files in my Mac via wifi to my music player (Logitech Squeeze Box 3), and I don't always have access to the Internet. Of course an Airport Express or any router would solve the problem, but that means one more device.
I tried what bbucysuggested, i.e. create a network on my macbook, then turn on "internet sharing". My music player (and other mac) can't see the network defined by the "internet sharing" (I give it a different name from my macbook in "Wi-Fi Option"). They see the name of my macbook, but cannot connect to it.
I know this thread is getting a bit old now, but I've been trying to achieve something similar, that is to mirror an iPad 2 to a television set via an Apple TV3, without an internet connection or a router. Today I succeeded in displaying the screen on my iPad on to my large TV screen! Basically I followed bbucy's method above. However, instead of a MBP, I used a Compaq laptop loaded with Mac OS 10.5.8 (Leopard). Once the ad-hoc network was running on the laptop, the iPad soon found the network, connected to it, and then allowed AirPlay to dsiplay the iPad screen. I will try doing the same thing using an iMac running Mac OS 10.7.4 (Lion) instead of the Compaq, and if successful report back.
No luck with the iMac and 10.7.4 I'm afraid. My iMac is on a different floor and quite a distance from the ATV - maybe its wifi range is limited. When I get time, I'll move the iMac closer to the ATV and try again.
The strange thing is that bbucy's method "Shares your Connection from" - to Ethernet, and "To computers using" - to Airport appears to involve an ethernet connection, when in fact no such connection is involved. I believe my iPad is connecting to the MBP by wifi, and the MBP is connecting to the ATV3 by wifi, using an ad-hoc network that doesn't connect to the internet, so how the software is dealing with it all, who knows?
It is not strange that an Ethernet connection is involved. In 10.6 (I believe in 10.5 as well) you don't need an actual connection to the Internet on your Ethernet to make your ad-hoc network work. You just set your system to share an Ethernet (or Firewire, Bluetooth DUN, whatever) connection, and that Ethernet connection doesn't have to be actually connected to the external Internet. Well, in 10.7, your Ethernet does need to be actually connected to the external Internet. If it is not connected, your devices (iPad, ATV, etc) won't find the network, i.e. you ad-hoc network is not established.
Just to add my two cents, after looking at this for a while, I got my Apple TV to connect to my MacBook Air's ad-hoc wifi network by first turning on internet sharing, and sharing the bluetooth connection to my phone which I'd turned Bluetooth tethering on. So far it works fine I've watched HD tv shows with no issues.
So the bottom line is you need to be sharing some internet connection via wifi from your mac in order for the Apple TV to see the ad-hoc network.
Like WorldWideWarren I want to demonstrate iPad to small audiences in rooms that have HDMI-equipped TVs, but maybe not Wi-Fi networks that I can easily access. I'm using an MBP (old, no AirPlay capability) running Lion (10.8.2), an Apple TV2 and an iPhone 3GS running iOS 5. I basically followed the approaches outlined by Bbucy and Someduckperson earlier in this thread:
1. Establish an Internet connection on the MBP without using a Wi-Fi router or modem (e.g. using the iPhone tethered as a Personal Hotspot using Bluetooth or via a USB cable). You could also use a 3G or 4G dongle plugged into the USB slot. My (untested) hunch is that the ATV2-Lion combination wants to handshake with iTunes, so I don't think this approach will work for WorldWideWarren on cruise ships.
2. Creat an ad-hoc network on the MBP (Control-click the Wi-Fi fan). Change the name and use a password for security if you wish.
3. In System Preferences, select Sharing, then "Share your Connection from" - select USB iPhone (in my example - the options to choose from will vary), then "To computers using" - select Wi-Fi (meaning the ATV2). Enable Internet Sharing in the left-hand table. Accept the warning that this could be unsafe practice.
4. Connect the ATV2 to the HDMI TV and select the relevant source on the TV. On the ATV2, go to Settings click down to Network and the ATV should now find your newly-created ad-hoc network. I didn't set up the ad-hoc network with a password, so the ATV didn't ask for one.
5. On the iPad, go to Settings and find the same ad-hoc network. Go to Airplay, choose the ATV and switch on mirroring.
My goal was to set up a system for audience demonstrations of iPad tricks and functions, so I haven't yet tried streaming video or music, but it should work - although likely a bit slowly for anything I pull down from iTunes over a 3G wireless internet interface, instead of my normal ADSL landline.
Another option that would work for WorldWideWarren, instead of MBP you could take along an Aiport Express - I have the May/June 2012 release $75 Apple refurb - set up with a local network, fire it up, then join the network with ATV and iPhone. Anything that has the airshare symbol will stream to the ATV.
I set up the Airport Express wirelessly by opening airport utility, select the Express, edit, then
Wireless>Newtork Mode: Create a Network
Security: I used WPA/WPA2 Personal
Password: your choice but it must be 8 characters
Internet> Connect Using: Static and the IPv4 address filled in automatically, for me a 169. address
Router Address: I copied the IPv4 address but changed the last 3 digets to 254
Two errors will come up:
No DNS Server
I was able to select ignore and now they have green dots by them.
When you connect to your AppleTV you will need to select the network name you created, enter your password, if selected, then a screen comes up saying "Connection Failed" Just select "Continue Without Internet" Then the Configure IP window comes up next. Select Automatic.
Apple TV will apply the settings and the WI-FI Configuration window will show up. Just click your menu button on your remote, go back to your idevice or computer, then start streaming to AppleTV.
The nice thing is that it works with everything. Currently I have a Mavericks and Lion OS computers connected, as well as my iPhone 5s and iPad 1. I can play movies from my iPad or iPhone 5s to AppleTV using the airplay. Powerpoints via AipPlay from Mavericks and Air Parrot from my Lion computer.
Problems: When I selected wireless options and selecte 5GHz Network>Save>Update a Invalid value warning came up. When I clicked>Review Settings I saw the IPv4 address had changed to an address beginning with 192. which is the same as the wired network in our building so I just> Cancel > Don't Update - cancelled out of the Update. I suppose, if you really needed a 5GHz network, you could just copy the IPv4 address down to the router line, chaning the last 3 digets or try copying the Router Address up to the IPv4 line and change the last 3 digets, ok, just the last diget would suffice. But mine is working so I am leaving it alone.
What I cannot figure out is how the Airport Express stayed connected to my Mavericks computer as I changed the network. To start, the express and iMac were both on network a which has the 192 addresses, once I changed the wireless name to b and the Network to Static with the 169 addresses I figured it would disconnect, but it did not.
Something else I have noticed (not being someone who works in setting up networks) is that if you connect wirelessly to a computer connected to the internet or LAN, the IPV4 address will also change. Doesn't seem to disrupt any other connections.