+1 here. Since March 6 updates (must have been the same than Vytas).
I see exactly the same symptoms (network is listed normally under the 
nm-applet, but selecting it fails to connect).
My network is open too.
Bugs is present both with 2.6.24-11 and 2.6.24-10.
I'm using an atheros card.

in /var/log/daemon.log:
Mar  8 23:57:30 poliahu NetworkManager: <WARN>  
nm_utils_supplicant_request_with_check(): nm_supplicant_interface_init: 
supplicant error for 'INTERFACE_ADD ath0^I^Iwext^I/var/run/wpa_supplicant0^I'.  
Response: 'FAIL'

-- 
[Hardy] Wireless broken with latests updates
https://bugs.launchpad.net/bugs/198971
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