I'm afraid Wireless is a bit of a black art and you problem may not be the Password procedure. You may have another network nearby on the same Channel, you may have interference from another appliance (DECT phone for example) or even a Bluetooth device.
I'd start by changing the WiFi Channel. Move it to the another number (1,7 or 12) and try that.
You may even be better using a manual address for your adaptor (say 192.168.0.99 with submask 255.255.255.0).
Try some of these things and post back.