Requirements:
Basic working knowledge of networking
Hub, switch or prefferably a router
cat5 patch cables using rj45 plugs (looks like an oversize phone plug)
kohle's pso-gc server v1.4 or better
pc with windows 2000 or XP, professional if possible
1 functional 10/100 nic in your pc with rj45 input

some notes:
as i write this i am using windows xp pro sp2 so the instruction i provide are not one-size-fits all.
this does not take into account wireless networking
this assumes your machine has ONE ethernet adapter (other wise known as a network interface card, or NIC)
because of my topography, i am forced to use a mix of DHCP and manually configured ips, pso-gc server doesn't seem too finicky about this but your milage may vary, but for this reason i'm forced to assume you are using a hub or router and manually configuring your ips. this is the cheapest way to go, and is fairly stright forward.
if you have no internet access, you don't need a firewall. if you have a firewall then make sure it allows psoserver.exe complete access to local ips and ports.


ok, now lets setup your network..
if you have an ethernet card installed or your mainboard has one built in, make very well sure that the drivers are current and functioning.
you may have to run the networking wizard to install local area networking support for your nic.
once you have done so, check your network properties, verify that tcp/ip services are installed and reboot before continuing if you find yourself adding or re-adding tcp/ip support.
connect the cat5 patch cable to your pc and the other end to a port on your hub, any should do unless your using a very old hub or a very very cheap one. make sure the hub has power and a set of lights should apear indicating your hub has a connection to you pc.
connect another patch cable to your gc, and with no disc insterted, turn on the power. another set of lights should come on that corresponds to your gc when you plug the other end of the patch cable into it.

so far you have two sets of lights, sometimes they flash sometimes they don't, 
place pso ep1-2 in the gc and allow it to load, select the options menu item, go to and select network options, then select provider options. the game will ask you if you want to go into webmode or something of the like, let it know how fond you are of webmode by telling it to continue. if your card does not contain any network information you will be prompted to make the file. if you decline your gamecube's generosity you can then use network data from another card in the other slot.

you are given two options from here once it loads.. provider 4 and provider 5.
pick one,
go on,
surprise me.
select edit menu, on the first page you may rename the provider, this is how it will appear on that provider page.
on the next page, set the option to manually configured IP.
the very next page will require ALOT of info

IP: set this to 192.168.1.32
DEFUALT GATEWAY: set this to your pc OR router's ip, usually 192.168.1.100 and 192.168.1.1 respectivly
SUBNET: set this to 255.255.255.0
PRIMARY DNS: Your pc's ip, usually 192.168.1.100
SECONDARY DNS: reenter you pcs ip here just to be sure

you can ignore everything on the proxy page and continue to the last page, select the save button once there.

now your pc and gc are configured to talk to one another, if you have a router it should be in the know by now too right? most routers only filter info coming from ips that are not local (ie 192.168.x.x) so you should be able to run kohle's server software.. and hubs and switches should just paas the connections through.
once psoserver loads all its services, go to your gamecube and have pso go online, select any character and enter your SN/AK info if prompted to, try to use the info provided with your disc or find a legit number so you can connect to sega still or schthack's. oh, and letting the cube save the password to the card would be keen as well. it should attempt to connect and your info will be written to the memory card once you successfully contact the server on your pc.

if any of this gives you trouble, google it.
all you are doing is making two computers connect over a tcp/ip connection on a lan, the pc is the server and the gc is the client.

quick rundown:
the servers ip should be 192.168.1.100
if your using a router as a gateway, its ip should be 192.168.1.1
if your using either with only one NIC then the subnet mask should be 255.255.255.0
if you are using a hub/switch or cross over cable, your DNSs are your PC's IP
if you are using a router, your DNSs are the router's IP which should be 192.168.1.1
your gamecube's ip should be 192.168.1.32
all other cubes should have original ips, just add one to the last octet.
(gc one is .32, gc two is .33, and so on)
if you are using the dual NIC solution, change your subnet mask on the gc so its going into the appropriate NIC. probabaly 255.255.255.1

if you are still confused, take a coupla asprin and try it again before coming back to the forum, get a friend to help, call joe or something.