Ok, that is pretty much what I thought, you may need to turn NAT off on the upstairs router then, the upstairs device doesn't need to be a router at all, just an access point as routing functions are not required with your setup. I would check the upstairs router to ensure that all security functions other than WPA are turned off. With the IP addresses you don't need to worry about publishing them up here, the 192.168.0.0/16 subnet is private so nobody can glean anything important about your network from it.
What the firmware update might have done is turn the DHCP server on in the upstairs router, you will not need this because I presume the downstairs router is doing it for you. Therefore, the first three octets (numbers between the periods) will need to be the same for the upstairs laptop and the downstairs computers. i.e. 192.168.0.1-192.168.0.4 downstairs and 192.168.0.5-192.168.0.254 upstairs, the parts in bold should be the same for all computers assuming the subnet mask is 255.255.255.0
If this is the case, take a look at the address of a downstairs machine and try to ping it from the laptop: on the laptop go to Start>Run and type "cmd" (without the "") in the box, then click ok. A black command prompt will appear, type "ping 192.168.x.x" where 192.168.x.x=the address of the downstairs computer. If all is ok, a reponse in milliseconds will be displayed, otherwise it will show an error.
Please tell me if I am going into too much or too little detail.
Andrew