Same problem here, on HP6910P. Intel's wifi.
Very very annoying.
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Intrepid: WLAN LED blinks incessantly on iwl3945 | iwl4965 laptop
https://bugs.launchpad.net/bugs/250211
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ubuntu-bugs
I have the same problem. Can't connect to my "Wippies" router when using wpa.
It do however works when I'm connecting to the non encrypted connection.
Found out that if I do "sudo su" and then ''killall NetworkManager" and then
restart networkmanager again with "NetworkManager" it seems to work