Its not "bad" per se, but its not particularly good. Any idiot who knows how to google can find out how to crack a WEP code in about 5 mins, and it'll take that long to crack it too once you have the right software. However, depending on where you live, that may be OK. If you live in a built up area, something more secure would be best. If you live in the middle of nowhere, people probably aren't going to hack into your WiFi anyway.
As for connecting your DS without using WEP, you can turn off security completely, and add a whitelist of MAC addresses that are allowed to connect, and then only certain devices can connect, which is more secure than WEP anyway, but more hassle too, as you have to find the MAC address of every device you want to connect, and manually add more everytime you want to connect a new device.