I am experiencing the exact same problem, I must admin it's really frustrating. I upgraded my Toshiba Tecra M3 last night, and upon rebooting the Wireless was in a funny broken state. It prompts me for my WPA key, sometimes it accepts the key and sometimes not :(, was working fine in Gutsy.....also when I click on "Configure" for eth1 in the network manager it says "The interface does not exist", I way happy with Gutsy and thought upgrading to Hardy will make things better, instead I am now frustrated and thinking of reverting back to my old PowerBook G4 for work stuff...

May 11 11:25:40 jonathan-laptop NetworkManager: <info>  New VPN service 'vpnc' (org.freedesktop.NetworkManager.vpnc).
May 11 11:25:53 jonathan-laptop NetworkManager: <info>  Found radio killswitch /org/freedesktop/Hal/devices/ipw_wlan_switch
May 11 11:25:53 jonathan-laptop NetworkManager: <info>  eth1: Device is fully-supported using driver 'ipw2200'.
May 11 11:25:53 jonathan-laptop NetworkManager: <info>  eth1: driver supports SSID scans (scan_capa 0x21).
May 11 11:25:53 jonathan-laptop NetworkManager: <info>  nm_device_init(): waiting for device's worker thread to start
May 11 11:25:53 jonathan-laptop NetworkManager: <info>  nm_device_init(): device's worker thread started, continuing.
May 11 11:25:53 jonathan-laptop NetworkManager: <info>  Now managing wireless (802.11) device 'eth1'.
May 11 11:25:53 jonathan-laptop NetworkManager: <info>  Deactivating device eth1.
May 11 11:25:54 jonathan-laptop NetworkManager: <info>  eth0: Device is fully-supported using driver 'sky2'.
May 11 11:25:54 jonathan-laptop NetworkManager: <info>  nm_device_init(): waiting for device's worker thread to start
May 11 11:25:54 jonathan-laptop NetworkManager: <info>  nm_device_init(): device's worker thread started, continuing.
May 11 11:25:54 jonathan-laptop NetworkManager: <info>  Now managing wired Ethernet (802.3) device 'eth0'.
May 11 11:25:54 jonathan-laptop NetworkManager: <info>  Deactivating device eth0.
May 11 11:25:54 jonathan-laptop NetworkManager: <info>  Will activate wired connection 'eth0' because it now has a link.
May 11 11:25:54 jonathan-laptop NetworkManager: <info>  Wireless now enabled by radio killswitch
May 11 11:25:54 jonathan-laptop NetworkManager: <debug> [1210461954.475517] nm_hal_device_added(): New device added (hal udi is '/org/freedesktop/Hal/devices/platform_bluetooth').
May 11 11:26:29 jonathan-laptop NetworkManager: <info>  Updating allowed wireless network lists.
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  SWITCH: no current connection, found better connection 'eth1'.
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Will activate connection 'eth1/my_wireless'.
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Device eth1 activation scheduled...
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) started...
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 1 of 5 (Device Prepare) scheduled...
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 1 of 5 (Device Prepare) started...
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 2 of 5 (Device Configure) scheduled...
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 1 of 5 (Device Prepare) complete.
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 2 of 5 (Device Configure) starting...
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1/wireless): access point 'my_wireless' is encrypted, but NO valid key exists.  New key needed.
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) New wireless user key requested for network 'my_wireless'.
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 2 of 5 (Device Configure) complete.
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) New wireless user key for network 'my_wireless' received.
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 1 of 5 (Device Prepare) scheduled...
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 1 of 5 (Device Prepare) started...
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 2 of 5 (Device Configure) scheduled...
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 1 of 5 (Device Prepare) complete.
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 2 of 5 (Device Configure) starting...
May 11 11:26:30 jonathan-laptop NetworkManager: <info>  Activation (eth1/wireless): access point 'my_wireless' is encrypted, and a key exists.  No new key needed.
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: sending command 'INTERFACE_ADD eth1^I^Iwext^I/var/run/wpa_supplicant0^I'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  kernel_driver for non broadcast check: ipw2200 (has_scan_capa_ssid=1)
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  Using has_buggy_scan_capa fix for ipw2200
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: sending command 'AP_SCAN 2'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: sending command 'ADD_NETWORK'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: response was '0'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: sending command 'SET_NETWORK 0 ssid 6d795f776972656c657373'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: sending command 'SET_NETWORK 0 scan_ssid 1'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: sending command 'SET_NETWORK 0 proto WPA'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: sending command 'SET_NETWORK 0 key_mgmt WPA-PSK'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: sending command 'SET_NETWORK 0 psk <key>'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: sending command 'ENABLE_NETWORK 0'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:26:31 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 2 of 5 (Device Configure) complete.
May 11 11:26:36 jonathan-laptop NetworkManager: <info>  Old device 'eth1' activating, won't change.
May 11 11:26:36 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 0
May 11 11:26:36 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 0
May 11 11:26:41 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 0
May 11 11:26:41 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 0
May 11 11:26:42 jonathan-laptop NetworkManager: <info>  Old device 'eth1' activating, won't change.
May 11 11:26:46 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 0
May 11 11:26:46 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 0
May 11 11:26:47 jonathan-laptop NetworkManager: <info>  Old device 'eth1' activating, won't change.
May 11 11:26:51 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 0
May 11 11:26:51 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 0
May 11 11:26:52 jonathan-laptop NetworkManager: <info>  Old device 'eth1' activating, won't change.
May 11 11:26:56 jonathan-laptop NetworkManager: <info>  Activation (eth1/wireless): disconnected during association, asking for new key.
May 11 11:26:56 jonathan-laptop NetworkManager: <info>  Activation (eth1) New wireless user key requested for network 'my_wireless'.
May 11 11:26:56 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 0
May 11 11:27:14 jonathan-laptop NetworkManager: <info>  Activation (eth1) New wireless user key for network 'my_wireless' received.
May 11 11:27:14 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 1 of 5 (Device Prepare) scheduled...
May 11 11:27:14 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 1 of 5 (Device Prepare) started...
May 11 11:27:14 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 2 of 5 (Device Configure) scheduled...
May 11 11:27:14 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 1 of 5 (Device Prepare) complete.
May 11 11:27:14 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 2 of 5 (Device Configure) starting...
May 11 11:27:14 jonathan-laptop NetworkManager: <info>  Activation (eth1/wireless): access point 'my_wireless' is encrypted, and a key exists.  No new key needed.
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: sending command 'INTERFACE_ADD eth1^I^Iwext^I/var/run/wpa_supplicant0^I'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: sending command 'AP_SCAN 1'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: sending command 'ADD_NETWORK'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: response was '0'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: sending command 'SET_NETWORK 0 ssid 6d795f776972656c657373'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: sending command 'SET_NETWORK 0 proto WPA'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: sending command 'SET_NETWORK 0 key_mgmt WPA-PSK'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: sending command 'SET_NETWORK 0 psk <key>'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: sending command 'ENABLE_NETWORK 0'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  SUP: response was 'OK'
May 11 11:27:15 jonathan-laptop NetworkManager: <info>  Activation (eth1) Stage 2 of 5 (Device Configure) complete.
May 11 11:27:16 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 0
May 11 11:27:16 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 0
May 11 11:27:16 jonathan-laptop NetworkManager: <info>  Activation (eth1/wireless): disconnected during association, asking for new key.
May 11 11:27:16 jonathan-laptop NetworkManager: <info>  Activation (eth1) New wireless user key requested for network 'my_wireless'.
May 11 11:27:21 jonathan-laptop NetworkManager: <info>  Supplicant state changed: 1