iTunes

"Is there anyway that connecting mybooklive to my router…could actually slow my internet down?! 

  • No. Unless somehow, there is access to/from the internet to the MBL. The more machines accessing the internet at the same time at your house, the more people sharing the same connection.

“I’ve noticed since I connected it a little over a week ago, my signal (bars on my laptop) has dropped 2 bars.”

  • Well, the MBL and the internet, have nothing to do with the signal strength of the wireless signal.

And since it seems you are connected via wireless, chances are that is your weakest link, you did not provide more details. but for wireleess “g” you would get about 2MBs max. Nevertheless, it should work fine.