I have same problem on an IBM Thinkpad T30 with Prism2 (internal IBM
"mini PCI" card) running hostap driver.

I see that NM disconnects from my WPA network with "sudo iwconfig wlan0
essid x mode managed", but then fails to connect to an unencrypted
network -- in fact, it pretty much freezes the desktop.  I lose
keyboard, and notice that the Gnome system monitor status applets also
freeze, I cannot open new windows (using Gnome applets).  Only the mouse
appears to work.

I can sometimes turn the system off, but not always.  In those cases
when it failed to shut off after 30 seconds, I have not had the patience
to wait to see if it will eventually turn off by itself.  Actual system
shutoff does not happen -- it says it will shutdown in the console after
unmounting drives -- but this perhaps an unrelated bug:

https://bugs.launchpad.net/ubuntu/+source/linux-source-2.6.15/+bug/43961

https://bugs.launchpad.net/ubuntu/+source/linux-
source-2.6.20/+bug/104741

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Keyboard killed when using hostap_pci with NetworkManager
https://bugs.launchpad.net/bugs/89464
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