I have both a Nexus S and the DIR-825. You don't need to setup your router to be "G" only or even 2.4 GHz only. The phone supports the "N" band.
My settings are as follows:
Wireless Band: 2.4GHz Band
Enable Wireless : [Checked] Always
Wireless Network Name : "Whatever you what"
802.11 Mode : Mixed 802.11n, 802.11g and 802.11b
Enable Auto Channel Scan : [Checked] (uncheck this if you want to manually select your channel)
Wireless Channel : [grayed out if auto scan is checked]
Channel Width : [Auto 20/40MHz]
Visibility Status : Most people want their WiFi visible
Security: "Whatever you decide" I use WPA-Personal
WPA Mode: [WPA2 Only]
Cipher Type: [AES]
Group Key Update Interval: [3600]
Wireless Band: 5GHz Band
Enable Wireless : [Checked] Always
Wireless Network Name : "Whatever you what" (I add 5GHz behind the SSID to differentiate the two networks)
802.11 Mode : Mixed 802.11n and 802.11a
Enable Auto Channel Scan : [Checked] (uncheck this if you want to manually select your channel)
Wireless Channel : [grayed out if auto scan is checked]
Channel Width : [Auto 20/40MHz]
Visibility Status : Most people want their WiFi visible
Security: "Whatever you decide" I use WPA-Personal
WPA Mode: [WPA2 Only]
Cipher Type: [AES]
Group Key Update Interval: [3600]
Make sure you have the newest version of Android (2.3.3) as 2.3 and 2.3.1 were really buggy, I had problems with my WiFi on 2.3.1. I would also suggest rooting your phone and flashing Cyanogenmod 7 to your phone if you really want to unlock the full potential of the phone. See the links below for more information on rooting and Cyanogenmod if needed.
http://www.cyanogenmod.com/http://forum.xda-developers.com/forumdisplay.php?f=880