You don't need to change much parametres for the simple configuration. The devil is not so black as he is painted ;-)
Just change your network addresses in the squid.conf, say
acl localnet src 192.168.1.0/255.255.255.0
http_access allow localnet
If you want your proxy to be transparent, be sure to have in the config file:
http_port 3128 transparent
Though it may depend on the Squid version, so, don't hesitate to consult the official documentation, it's really well-written.
And add a rule to iptables which will work for the LAN-connected interface:
iptables -t nat -A PREROUTING -i ethX -p tcp --dport 80 -j REDIRECT --to-port 3128
Don't forget to
for the first time you start your proxy, this command will create the hierarchy of directories for cache, but I think that if you'll start Squid from some script like /etc/init.d/squid or /etc/rc.d/rc.squid - this command will be executed from it.