I have the same problem described. I am using Linux Mint 4.0, based on Ubuntu 
7.10 Gutsy Gibbon  quite recent so.
The cause of the problem I can only think of is: I recently reported a bug to 
Ubuntu. Some program started in the background then. A tab was added, I 
couldnot refuse that. A screenprint was sent with the bugreport (eog)

https://bugs.launchpad.net/ubuntu/+bug/237812

I tried to Configure eth0: avahi,  It was not possible: no Interface it said.
As I unplugged the cable twice the problem was gone.
 There was no longer eth0: avahi and my Internet connection worked again. It 
seems that I should not ask for help of Ubuntu :) 

 I didnot restart my laptop, so I cannot say now if the problem resists.

** Attachment added: "eth0: avahi"
   http://launchpadlibrarian.net/15187223/Schermafdruk-network-admin.png

-- 
[feisty] nm gives me an ip even if there is no cable
https://bugs.launchpad.net/bugs/78078
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