How do I stop my iMac from dropping my Wifi connection?

Hmmm, do you have any source of microwaves around that could be interfering? Like TVs, Phones, etc?

Sometimes changing the channel on the Router helps.

Try giving this a read https://discussions.apple.com/thread/3947671?start=90&tstart=0 read the last post on the last page of that. The writer basicly says that you should try changing the energy saving settings for putting the computer to sleep.