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...when some one plays xbox...
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Do you mean as soon as they power up and attempt to connect? Or randomly, all of a sudden, in the middle of game play?
When this happens, can the computer that is connected to the router directly via Ethernet still access the Internet with no problems?
Unfortunately, you told us nothing of your router! I am guessing you have a wireless router and not separate components. That said, I will take this moment ensure there is no confusion and clarify some terminology. Data can be "broadcasted" over the air (as sound, light, or radio waves), wire (Ethernet), or light in fiber optics. So we need to make sure you mean only the wireless side stop working.
Also, a wireless router is really 3 discreet networking devices jammed into one case.
1. The "router" - a device to connect two networks (the Internet and everything on your side of the router)
2. Switch (or smart hub) - typically a 4-port 10/100 Ethernet switch
3. Wireless access point (WAP)
and some may also have
4. Print server
If your Ethernet connected PC can access the Internet, then the WAP side is having problems. Make sure the setup menu has not been set to limit the number of connections.
I think you should check your router maker's website too - there may be a FAQ or knowledge base article on this problem. There may also be a firmware update/fix available.