Technical challenge for networking gurus!

Hello chaps :)

I have a Netgear L2 switch (Netgear call it a 'Smart Switch' but it has L2 features) and a Netgear firewall/router (FS726T and FVS338 respectively). I am trying to achieve the following scenario:

Room A consists of several PCs and a server.
Room B consists of several PCs.
Room C consists of the router and 2 printers.

Room A must not be able to talk to Room B and vice versa, but both Room A and Room B must be able to talk to Room C.

I had this working well with VLANs but, when packets come in from the router they hit the switch on the default VLAN which has all ports as members, and so broadcasts the packet to all the switches. I believe this is either a limitation of the switch or TCP/IP in general.

To combat this broadcast problem, I've tried patching the router into each VLAN separately, which solves the problem, but because the router effectively only has 2 interfaces (WAN and LAN) with the LAN interface bolted onto a built in switch, the 2 VLANs are now bridged by the routers' switch. Room A and Room B were then able to communicate.

So then I thought about doing this with subnetting instead/as well. The router can be multi-homed so that's ok, but the printers cannot, so only 1 subnet would be able to print. I thought about overlapping subnets but started to get very very confused :(

The bottom line is... can I achieve my scenario with the kit I've got? The problem stems from excess broadcast traffic from the router when in the default VLAN, but I'm at a bit of a loss as to what to try next.

Any help would be appreciated :)