You will definitely need a device with router and switching capability. They come either with or without the wireless access point capability - if you use a powerline network, you don't need an access point, just the router/switch part.

I personally am leery of the powerline and phoneline networking technologies. They work, and there is a variety of equipment out there, but the general notion a few years ago of networking your house without needing to drill holes in the wall and pull ethernet cable by using the existing electric or phone wiring was, just in the last year, completely run over in the marketplace by wireless. Thus, in terms of availability, continued development and manufacturer support, and brand interoperability, the powerline and phoneline options are not as attractive anymore.

If you are concerned about the range of the wireless signal not reaching the third floor, you can do things like adjust antenna positions, move the base access point to a more central location, use low-tech reflectors, high-tech higher external antennas, or even set a repeater on the second floor. These problems can be solved.

dw