I just mentioned about Connectify a few posts ago. Here’s a free application, Virtual Router, that makes use of the same Virtual WiFi technology on Windows 7 to create a Virtual Router out of your laptop or PC. As pointed out by various people, it only supports WPA2 which it seems to be a limitation (or feature if you wish) of the Wireless Hosted Network API’s provided by Microsoft to ensure the best security possible. It worth a try out.
Link: Virtual Router