Only two files needed: fs.zip and ?.img (click on two links in):http://wiki.laptop.org/go/No-Fail_Upgrade
section with XO not connected to internet.
For router / AP, be aware of the difference between password, passphrase, and encryption key (HEX key).
Suggest for your router / AP for very temporary testing:
Set to Channel 1, 6, or 11
Turn on SSID broadcast
Set for Managed or Infrastructure
Set for mode Open (unless it is an Apple Airport)
Disable encryption (WEP, WPA)
Disable any IP address or MAC filtering
Disable router password
(also be aware of any port filtering that may limit any software access to internet)
Most router / AP will have these as the default out of the box or when any reset button is pressed.
In Neighborhood View (wait two minutes until mesh search finishes), click on your router/AP icon and it should connect (no pop menu will occur when the AP encryption is disabled). If you do get a popup menu, it may be asking for a router password. Run Activity Browse and try to connect to : http://yahoo.com
If you make any significant changes in the parameters on the AP, erase on the XO the network history and reboot (in new software in menu under "X man" icon Control Panel / Network).
If you do not want to very temporarily disable security, try WEP 128 with HEX key (select key 1), and then on XO popup menu use 40/128 hex with entry of key 1 (case sensitive) and Open mode.
Finally, if you cannot connect, try resetting the radio by removing and replacing the battery (the radio stays on even when you power OFF). This should be done with power OFF and charger unplugged.