Wi-Fi 'Greyed out' on 3g. Any fixes? Hardware glitch?

It may be hardware, but first Reset Network Settings,the restore as a new phone in iTunes.

You didn't say where you are, but if it is a year and a half you have had your phone in the US at least you would be eligible for an upgrade. If not Apple will repair it for a flat fee that is $199 in the US.

I am in the same position. My iPhone is also a year and a half old. I am running ios 3.1.3 and my Wi-Fi just isn't working at all. I have tried hard resets, resetting the data, everything. It is very frustrating because I have the 2g per month data plan and I keep having to overpay for my data plan because I cannot use Wi-Fi anymore. The iPhone can't even find Wi-Fi spots anymore. I don't want to have apple fix it for $199 because at that rate I would just wait a year for my 2 year contract to run out and get a new iPhone 4. I also don't want to try restoring it to factory settings because then I would be stuck with it on ios 4, which does not bode so well for the iPhone 3g (very slow & unresponsive). Does anyone have some ideas for me?

Have you tried this? http://support.apple.com/kb/TS1559

Just a reminder. Apple welcomes feedback and bug reporting.

Please let Apple know in one of two ways.

The simple way is at:
http://www.apple.com/feedback/iphone.html
Select Feedback Type: Bug Report
Fill out the form. Just takes a minute

If you are a developer, registered to be a developer, or at least understand the lingo, you can report the bug at
https://bugreport.apple.com/
Fill out the form. It is more complex, but a few have had an email contact asking for more information. A Core Duo chip is required to run the program that generates the report to send to them.

If it is happening to enough people and we start telling Apple, they may look into it. Or it may be a non issue by the end of this week with the release of 4.1.

4.1 did not help me, what about you?

At least with the speed increase of 4.1 I find out quicker that my iPhone Could not find the network...

Back to square one of trouble shooting before I turn in a bug report.

Genious just told me that a greyed out wifi mean the chip is bad.

Said to check Bluetooth. If it greyed out then the whole chip is bad. If it is usable, then the wifi half of the chip is bad.