Also got "connection timeout occured".
After wireless router password has changed, connecting does not give me a new change to enter the password. Tried several approaches in this thread.
I think the following is the root of the problem
Removing password from 'Keychain Access' did not resolve, because when entering a new password, the old password was kept in Keychain Access".
Solution:
So Deleting password does not solve, but you can edit the password in Keychain Access, this will work (in my case).
Possible other ways of solving: Changing SSID of wireless router (but then all your other devices/family members, have to select the new network again)
My specs:
Mac Book Pro Lion 10.7.2
Router Draytek Vigor 2800
wireless: mixed mode (11b + 11g + SuperG)
Security: WPA/PSK Only