jeffrey,
Lawrence's suggestion may work for you, and if it does you won't need mine.
I'd ask you to decide on which encryption technology you want. There should no issue with your MacBook using WEP or WPA, but I can't tell what your Linksys supports.
Let's assume you choose WEP. Choosing WPA / WPA2 should only mean you enter your key in a different box on the router.
Then choose a password, either in ASCII or hex. And either 40/64-bit or 128-bit. I'd suggest an ASCII password, something you can remember, but slightly modified to remove it from a dictionary search, ie. appl3, as a 5 character ASCII password. For WEP, the password must be exactly 5 chars (10 hex) for 40/64-bit or 13 chars (26 hex) for 128-bit.
Then convert your chosen password from ASCII to hex, appl3 converts to 6170706C33. Use 'man ascii' in Terminal to see how to convert each char into hex.
Then key your hex password into the router in the first box of the passkey.
Then connect to the router wirelessly by selecting 'WEP 40/128-bit ASCII' and keying your ASCII password, ie. appl3. You can select 'WEP 40/128-bit hex' and key your password in hex if you like making things difficult for yourself. You decide if it's easier to remember a 5/13 character password or 10/26 hex digits.
You final statement is right, but like I said, you can also select one of the explicit 40/128-bit options and key the password like your choice (hex or ascii).