Setting Up a 2nd Router on 1 Modem

I feel a little embarrassed asking for tech help since I sell computers for a living and have built my last few computers by hand, but I'm going to reach out to you all for some advice and outside expertise here. I'll appreciate any feedback from you all. This description is a bit lengthy, but is necessary for you to understand my situation. Please bare with me.

I'm currently on a Verizon FIOS connection belonging to another family member, currently supposed to operate at 50mbps down and 25mbps up. Verizon provides a proprietary "gateway" (modem/router combination) which I believe connects to all computers as well as any DVR's in the house. (I use the word believe because I am not in charge of the bill and I did not set up this network, I moved in recently.) I have heard from Verizon & Comcast reps that visit my store that Verizon only has a Wireless G model of this combo, and does not offer a Wireless N variant. The house I am in was built in the 1950's and uses plaster in the construction, which I'm aware is a horrible building material for wi-fi to try and penetrate through.

When I moved here in October of last year, the signal on the second floor (remember that this modem/router combo is on the first) was poor, but stable, and I got reasonable speeds. Nowhere near the Verizon advertised speeds, but it was fast enough for programs like Netflix and video games. Broadband quality, if you will. I'm also aware that although the cap of a Wireless G router is 54mbps, that's not its average operating speed. This is why I was fine with my connection under achieving. I used a Netgear PCI Wireless N adapter to connect to it. Months later, I started experiencing random disconnects from the network. Eventually it happened so much so that I went out and bought a new Wireless adapter. This time it was a Linksys USB stick, a Wireless N Dual band adapter. The disconnects stopped, and everything was fine for a couple of weeks, until I noticed some significant lag during games.

Now it has come to the point where I cannot load simple YouTube videos, and I've recorded an all time low transfer rate of 30kb/s. I have however seen it go as high as 10mbps. It's not consistent. I have tested this a couple of ways as well. I have a smart phone that I used with the app to measure the bandwidth, and I got a record low 400kb/s on it at POINT BLANK range from the router. This confirms that it is not the walls or floors doing this, and it is not the wireless adapters I've been using that is causing the slow down. I also tested the wired ports on the back of the router, I get about 58mbps down, ABOVE my advertised speed. This leads me to the conclusion that the wireless portion of the modem/router combo is dying, and needs replacing. I will also note that the upload speed seems to be largely unaffected during most wi-fi tests (around 8mbps, again; not as advertised, but I'll take it). I now have tried a 3rd USB based network adapter, a heavily modified Realtek adpater from an independent person who sells them. The signal is now fantastic, but is still did not fix the speed issue.

Seeing as this device is not mine, before I start arguing about getting a replacement, I do have a spare D-Link Dual Band Wireless N router laying around from when I moved, and I was considering the thought of trying to establish a 2nd wireless network of my own, based off of one of the ethernet ports on the back of the original Verizon modem/router combo.

Bottom line is; would this work? And is it as simple as plugging in my spare router to the back ports of the first one? Or is there a more complex setup to it? And if so, what would I need to do?
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