Detected but not working.

New install on ubuntu 11.10 using coneptronic C54Ri.

As documentation says it uses Ralink drivers.... Any ideas why my wireless does not work?

$ lspci -nn | grep -i 'ralink'
01:05.0 Network controller: Ralink corp. RT2561/RT61 rev B 802.11g

ifconfig

eth0 Link encap:Ethernet HWaddr 00:1e:90:e5:af:13
inet addr:192.168.0.197 Bcast:192.168.0.255 Mask:255.255.255.0
inet6 addr: fe80::21e:90ff:fee5:af13/64 Scope:Link
UP BROADCAST RUNNING MULTICAST MTU:1500 Metric:1
RX packets:28361 errors:0 dropped:0 overruns:0 frame:0
TX packets:16858 errors:0 dropped:0 overruns:0 carrier:0
collisions:0 txqueuelen:1000
RX bytes:39812172 (39.8 MB) TX bytes:1633405 (1.6 MB)
Interrupt:43 Base address:0xc000

lo Link encap:Local Loopback
inet addr:127.0.0.1 Mask:255.0.0.0
inet6 addr: ::1/128 Scope:Host
UP LOOPBACK RUNNING MTU:16436 Metric:1
RX packets:80 errors:0 dropped:0 overruns:0 frame:0
TX packets:80 errors:0 dropped:0 overruns:0 carrier:0
collisions:0 txqueuelen:0
RX bytes:6608 (6.6 KB) TX bytes:6608 (6.6 KB)

iwconfig wlan0

wlan0 IEEE 802.11abg ESSIDff/any
Mode:Managed Access Point: Not-Associated Tx-Power=0 dBm
Retry long limit:7 RTS thrff Fragment thrff
Power Managementff

lsmod | grep rt

rt61pci 27493 0
crc_itu_t 12627 1 rt61pci
rt2x00pci 14202 1 rt61pci
rt2x00lib 48114 2 rt61pci,rt2x00pci
mac80211 272785 2 rt2x00pci,rt2x00lib
cfg80211 172392 2 rt2x00lib,mac80211
eeprom_93cx6 12653 1 rt61pci
parport_pc 32114 1
parport 40930 3 ppdev,parport_pc,lp

lsmod | grep rt

[ 2497.816989] phy0 -> rt2x00pci_regbusy_read: Error - Indirect register access
failed: offset=0x0000308c, value=0xffffffff
[ 2497.827112] phy0 -> rt2x00pci_regbusy_read: Error - Indirect register access
failed: offset=0x0000308c, value=0xffffffff
[ 2497.837430] phy0 -> rt2x00pci_regbusy_read: Error - Indirect register access
failed: offset=0x0000308c, value=0xffffffff
[ 2497.847528] phy0 -> rt2x00pci_regbusy_read: Error - Indirect register access
failed: offset=0x0000308c, value=0xffffffff
[ 2497.847632] phy0 -> rt61pci_wait_bbp_ready: Error - BBP register access faile
d, aborting.
[ 2497.847637] phy0 -> rt61pci_set_device_state: Error - Device failed to enter
state 4 (-5).

sudo lshw -C network

*-network DISABLED
description: Wireless interface
product: RT2561/RT61 rev B 802.11g
vendor: Ralink corp.
physical id: 5
bus info: pci@0000:01:05.0
logical name: wlan0
version: 00
serial: fa:b8:14:58:62:35
width: 32 bits
clock: 33MHz
capabilities: pm cap_list ethernet physical wireless
configuration: broadcast=yes driver=rt61pci driverversion=3.0.0-12-generic firmware=0.8 latency=0 link=no multicast=yes wireless=IEEE 802.11abg
resources: irq:16 memory:fdef8000-fdefffff

iwlist scan

lo Interface doesn't support scanning.

eth0 Interface doesn't support scanning.

wlan0 Failed to read scan data : Network is down

uname -mr

3.0.0-12-generic i686

Edit 1

$ rfkill list all 0: phy0: Wireless LAN Soft blocked: no Hard blocked: no

On reboot, sudo lshw -C network returns network is ok. Hovever, WPA keeps on asking the wireless key