What material should I line my enclosure with to prevent reflections?
Would a unidirectional attenna be the best?
Should I set the power level to the lowest possible?
A directional antenna with a very sharp frontal lobe. If the distance is short (and the client doesn't move), you may want to lower the power of the AP. Set the power to the lowest possible and crank it up one-at-a-time until the signal strengths go up.
Is there a preferred router that you recommend?
Depends on what you are doing. If you want to just test the RF receiver then buying a router is "over the top". I'd just get a plain 802.11 a/b/g/n AP.