What does the internet light on the router do when this occurs? Flash? Turn amber? Your primary DNS server is most likely to be the router itself, so Vista detects it but as the router has dropped the connection it's not passing on the actual DNS information as it normally would. Network diagnostics on the PC itself generally are not required if your PC still has an IP address - the connection between your router and PC is working, it's the connection between router and ISP that has failed.