This seems to be a driver problem related bug.
The issue should be reproducible with the live environment of the
Desktop CD of the development release - Hardy Heron. It would help us
greatly if you could test with it so we can work on getting it fixed in
the actively developed release. You can find out more about the
development release at http://www.ubuntu.com/testing/
** Changed in: knetworkmanager (Ubuntu)
Status: Confirmed => Incomplete
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[Feisty]knetworkmanager hangs on activation stage when connecting to WAP, WEP
https://bugs.launchpad.net/bugs/96097
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