Hi Charles,
The first thing that I would look at are factors that effect the Radio Cell. Have you tried to tweak the Radio Transmit power on AP1 to turn it down somewhat? The default power setting is Maximum, so try to turn it down to various settings to see the outcome and effect on the cell size.The other things that might be easy to try are, re=orienting any attached antennas or the AP itself if using a built=in anteena. Have a look at the following doc;
Configuring Radio Transmit Power
http://www.cisco.com/en/US/products/hw/wireless/ps4570/products_configuration_guide_chapter09186a00802085c3.html#wp1017196
Also have a look at these docs;
Use of Nonoverlapping Channels
When you have multiple APs in a wireless LAN (WLAN), ensure that the channels that the adjacent APs use are nonoverlapping. Nonoverlapping channels are frequency bands that do not have a frequency that is common to the other channels. For example, in the 2.4-GHz range, there are three channels that do not overlap (channels 1, 6, and 11). Therefore, when you deploy a secondary AP in order to extend the radio coverage, you can use:
Channel 1 for the first AP
Channel 6 for the next adjacent AP
Channel 11 for the third AP
From this doc;
http://www.cisco.com/en/US/products/hw/wireless/ps430/products_tech_note09186a00800a86d7.shtml#nonover
Hope this helps get you started!
Rob
