In the process of getting to know my new iPhone I ran into the problem of my iMacs Internet Sharing not surviving a reboot. Here is what you need to do to fix this issue. remember terminal commands are case and space sensitive and the sudo command is just as powerful as root access so use this at your own risk.

Step one:Open Terminal and type (or paste the following)

sudo sh -c 'echo killall InternetSharing >> /etc/rc.local'

hit return ( you may get a warning about the sudo command and a request for your password. if you do type your password and repeat step one)

Step two:type (or paste the following)

sudo sh -c 'chmod +x /etc/rc.local'

Step three quit terminal and reboot. Internet sharing should now be enabled upon every boot/reboot

This is confirmed using my iMac with OS 10.5.6 and my iphone