Comment 12 for bug 648428

Sorry i would like to say to blacklist rt73 (because of the name that let me think that the chip is rt2500 in your case).

You can do more tests:
$ sudo rmmod rt2x00lib rt2x00usb rt73usb rt2500usb
$ dmesg | tail
$ sudo modprobe rt2500usb
$ dmesg | tail
$ iwconfig wlan0

$ sudo rmmod rt2x00lib rt2x00usb rt73usb rt2500usb
$ dmesg | tail
$ sudo modprobe rt73usb
$ dmesg | tail
$ iwconfig wlan0

The aim is to get more information about what happen when one module (rt73usb or rt2500usb) load and how it success or not to initialise the device.

However I think your trouble is different from mine, and maybe launchpad isn't the best place for that, especialy it your hardware hasn't been working on Linux previsouly.