I too have freeze troubles in Gutsy due to rt2500 module (PCI card, WEP enc). 
If network is unconfigured i can boot perfectly. once i try to setup network 
trough network manager or manually, i get a freeze!
i have also feisty running is this box, and i have no trouble concerning 
network...

Forum post: http://ubuntuforums.org/showthread.php?p=3456159#post3456159

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[gutsy] Total hang on using rt2x00
https://bugs.launchpad.net/bugs/144867
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