Your gateway address should be 192.168.1.1
If you can see other machines on your LAN, then your selection of 192.168.1.2 is working!!!
The only other thing that must be set up right is the DNS server addresses.
In Houston (on Road Runner) we use:
But yours will be different. Still you could use these and they might respond.
Once you have the gateway and your IP set, you should be able to ping the numbers above. You should also be able to enter known IP addresses in IE.
For example, 188.8.131.52 is www.yahoo.com