I am having the same issue after the update. I have done a reboot; a reboot erasing all data and everything else I can think of. This is a huge problem. Anyone have any answers?
this solution doesn't work. I have rebooted. I have reset network settings. I have wiped out everything and gone to factory defaults, but basically once you upgrade to 2.0.1, wifi is gone. I called apple today and they are sending me into the store for them to look at it.
I am having the same problem (not able to connect via WiFi) since the last major update. Sometimes I get a WiFi connection, but that only lasts for a minute. As I said in another post, I had no problems before, nor do I have problems with my other systems connected to my home wireless network.
Just power off your iphone for a few minutes. Then turn it back on. I had the same grayed out problem and nearly had a stroke after going through all the work of figuring out that I had to switch to WAP 2, and then insert the 192.168.1.1 in front of the other DNS numbers to get it to work.
For the person unable to switch to WAP 2, you might try the same thing with your WEP. I had it working with WEP as well, but liked the tighter encryption with WAP 2.
I have the 3G 16GB. Don't panic, it isn't a hardware or software problem. Just need to turn it off, wait a minute, then turn it back on.