I did notice the same issue as most of you here - and found the reason ...
On friday I received to brandnew T-Mobile iPhones:
- iphone 3G S 32GB - setup was completed within a few minutes
- iphone 3G 8GB - shipped with fw 2.2, asked for the fw update
So I did first complete the update with iTunes after I connected the phone the first time to the computer. After starting the activation I did the same steps as before with the 3GS.
I started to setup WiFi and noticed, that the WLAN level was very week compared to the 3GS (full level / 3 segments), it only did show 1 segment, but also did find my WLAN SSID.
Connecting failed, I did re-enter the key 2-3 times then I started searching the internet for this issue and found this discussion.
In the meantime I investigated the problem deeper (I'm an IT professional) and I found the only solution that will help everybody of you - but won't satisfy !
All hints and tips with "reset" etc. didn't work !!
But try this, prepare the WiFi connect, enter you key and before klicking to the "Join" button go very close to the WLAN antenna of your router. When being in a range of ~ 5 centimeters everything will work fine.
My routers are AVM based, one is a 7270 with WLAN b/g/n enabled, the other network in another location is a Speedport W900V, but the hardware is also made by AVM. Both networks are working fine with WPA2(CCMP) with a 24-char key and all of my other equipment, including the iPhone 3GS.
On monday I'll swap my iPhone 3G, it's no questions that this is a hardware issue (iPhone 3G serial 889224......)
Regards,
Mike