Are you using the KDE3 KNetworkManager or the Network Management widget?
Does this also happen with the Gnome nm-applet?
** Changed in: knetworkmanager (Ubuntu)
Status: New => Incomplete
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[Hardy] network manager nor rt2400/rt2500 driver reconnects Wireless WiFi after
disconnect due to bad signal
https://bugs.launchpad.net/bugs/226601
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