>My internet access is handled via a broadband router (dLink 701). It is also acting as the DHCP server, handing out IP addresses.

Then I would go with the more secure 'user' option.

>What file do I put these settings in?

/etc/smb.conf or /etc/samba/smb.conf if you are using Red Hat 7's samba RPM. This assumes that you already have a [Global] config. Usually there is a default smb.conf that has some really good basic configs.

j