Firmware
Firmware is the software embedded into hardware that allows your computer to communicate and properly use the features of said hardware. Many products, especially routers and WiFi adapters, allow you to download new firmware from the manufacturer's website and update the product's capabilities.
From : www.datapro.net/techinfo/wifi_term.html
MadWifi
MadWifi is short for Multiband Atheros Driver for Wireless Fidelity. In other words: it is a Linux kernel device driver for Atheros-based Wireless LAN devices. The driver works such that your WLAN card will appear as a normal network interface in the system. Additionally there is support for the Wireless Extensions API. This allows you to configure most aspects of the device using common wireless tools (ifconfig, iwconfig and friends).
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MadWifi
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