I can confirm this on a Thinkpad R61 amd64.
@Chris:
my workaround for now is to echo (enable|disable) into /proc/acpi/ibm/bluetooth
which still works.
** Changed in: linux (Ubuntu)
Status: New => Confirmed
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[karmic] rfkill appears to not be working
https://bugs.launchpad.net/bugs/396956
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