Macbook Pro won't connect to Android Phone via Bluetooth (Tether)

I am trying to set up the "Tether" app that will turn my Android phone into a wifi hotspot. I have a Macbook Pro running 10.7.3.

I've done everything suggested in the Tether setup, for using an Android Phone with a Macbook.

Problem seems to be with Bluetooth. Using the Bluetooth setup assistant, I am able to successfully pair the computer and phone, or so it seems. The phone shows the pair, and the computer says yay, we're paired.

However when I exit the assistant, the phone is shown as "not connected" in the list of connected Bluetooth Devices.

I see from searching forums that there have been similar Bluetooth connectivity issues with audio devices such as speakers.

Has anyone been able to successfully troubleshoot?

Has anyone set up Tether successfully with a Macbook and Android phone? I have a Samsung Nexus S 4G. Yeah I know, time for an iphone. As soon as the contract is up in June.