We had this issue as well.
We reverted to firmware 7.5.2 and then reinstalled 7.6 and freshly reset the wireless settings and it seems to work now. Annoying, but at least we are back up and running!
Best of luck!
I had a similar problem after upgrading this morning.
Well, the UI message was the same, not sure about the Console messages.
Bizarrely after trying repeatedly, including rebooting computers, airport, etc. I left it for half and hour and came back the problem had disappeared and everything is now working fine.
I cannot explain what happened or why but my network is reliant on two Airport Express units to connect to the Time Capsule, i.e. ADSL Router -> Time Capsule -> Airport Express -> Airport Express -> MacBook Pro.
Perhaps it took a while to sort out the overlapping wireless networks which was a new feature of this version of the software.