DNS
You can use any DNS you want. For example I always use 194.179.1.100. But the best option is to use:
- The DNS recommended by your ISP (probably the DNS that other machines in your network are using now)
- If not sure use the one that you have in your machine configured (the one you are using to read this)
IP Address
You are using a Private class A that allows you to use 16Million of IPs (exactly 16.777.216). Maybe you should use a class C. Usually people use class C for small networks.
Here you have an example of the different types of Private Class Addresses:
- Private Class C: IP: 192.168.0.7
subnet mask: 255.255.255.0 Gateway:
192.168.0.5
- Private Class B: IP: 172.16.0.7
subnet mask: 255.255.0.0 Gateway:
172.16.0.5
- Private Class A: IP: 10.0.0.7 subnet
mask: 255.0.0.0 Gateway: 10.0.0.5
You have more info here :
http://en.wikipedia.org/wiki/IP_address (Check IPv4 private addresses section)
EDIT NOTES:
- I am assuming that you want your host to be x.x.x.7 and your gateway will be x.x.x.5
- Be careful that all the machines in your network must have same subnet mask.