Network config question (cisco 871W)

Since I am new to networking, but I have a pretty good handle on the basics, I need some expertise.

I have a 30-client network. Win 2003 standard and a Cisco 871W. I also have Cisco VPN connections (1 or 2 at a time).

How should I configure the network (DHCP, DNS, ect.) (what dns servers should I use? ISP?) I do not have a registered domain name (just .local)… I would rather the 2003 server do all the work. Will the VPN connections be affected if the 2003 server does the work???

much appreciated….