I have the exact issue on my notebook computer running a PRISM54 wireless card.
After yesterday's updates (as mentioned by Bart) networkmanager does not 
connect to my wireless network (WPA/WPA2 with PSK). After killing the nm-applet 
and plugging in a LAN cable I can configure the wired connection in 
NetworkManager and get internet access. I did not see any useful output in 
syslog though...

(I'm sry that I cannot attach any logs as I write this from my desktop
machine...)

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[hardy][iwl3945] 3945ABG cannot associate to public WPA2 PSK network
https://bugs.launchpad.net/bugs/203793
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