I had the above error (b43legacy-phy0 ERROR: PHY transmission error) in
Ubuntu 10.04 and came up with the following work around to get things
working very well (as fast and reliably as in MS Windows) using
ndiswrapper. My wireless card is a BCM4306/3 (14e4 4320).

 1. Temporarilty install b43legacy driver if necessary
    b43legacy executable is available:
    sudo apt-get install b43-fwcutter
    export FIRMWARE_INSTALL_DIR="/lib/firmware"
    wget http://downloads.openwrt.org/sources/wl_apsta-3.130.20.0.o
    sudo b43-fwcutter -w "$FIRMWARE_INSTALL_DIR" wl_apsta-3.130.20.0.o

 2. Using the GUI, deactivate the b43legacy driver so that it's not loaded
    by default.
    (Applications->System->Hardware Drivers)

 3. Install ndiswrapper and point it to bcmwl5.inf and bcmwl5.sys
    sudo apt-get install ndiswrapper-utils
    # Note: If apt-get doesn't work, you may have to install ndiswrapper-utils
    manually using dpkg.
    sudo cp PathToWindowsDriver/bcmwl5.* .
    sudo ndiswrapper -i ./bcmwl5.inf
    sudo ndiswrapper -m

 4. Add the following lines to your /etc/rc.local file (at the end, but above
    the exit command):
    sudo modprobe -r b44  <=====  IF APPLICABLE
    sudo modprobe -r ndiswrapper
    sudo modprobe -r b43legacy
    # Need to temporarilty load b43legacy to initialize hardware
    sudo modprobe b43legacy
    sleep 3
    sudo modprobe -r b43legacy
    sudo modprobe ndiswrapper
    # Restore support for hard-wire eth0 if applicable
    sudo modprobe b44  <=====  IF APPLICABLE
 
Step 4 is a hack, but this is the only way I could get it to work reliably. I'm 
sure someone can come up with a cleaner version, but hopefully this will work 
for those with no other options.

-- 
[lucid] b43legacy PHY transmission error causes wireless networking to freeze 
or fail
https://bugs.launchpad.net/bugs/558950
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