Hi Bob!
I have similar problems with the WG511v2 and I'm trying to fix them at the moment. I also had a WG511v1 and gave it to my girlfriend. Two weeks ago I bought a WG511v2 and installed it into my notebook. I installed the WG511v2 utility + driver from the original CD and we used it with WEP for a while with a WGR614v2 Netgear Wireless Router. After some hours of use the connection to the router always dropped and I had to restart the router. I think the problem was the router and I hate this router because I had different problems with it and there are no more firmware updates. But as we all know this is what Netgear does - every couple of months they release a new HW version (most products have version 6 or so) and if you have an older hardware you never get updates for it... So I bought a new Linksys WRT54GS router where one can install any open source firmware. I installed the latest DD-WRT mod and it is amazing what you get - you can configure anything you like and I don't have to reboot the router any more. So based on my experience I give an advice to all who hate those little Firmware problems or features missing (with Netgear, D-Link and whatever). Buy only products like the Linksys router where you can put your own open source firmware and where you have normal stable Linux running. You won't be dependent on one company and a few developers who are not able to fix their bugs. But back to the WG511v2. A few days ago I swiched to WPA-PSK and since then I have the same problems like you. The WG511v2 software seems to run only if there is a very strong signal. I have the impression that the connection drops if the signal becomes worse. Just like you say - everything shows to be still connected but the internet connection is actually gone. I also noticed that the Netgear icon becomes yellow before the connection drops. And in contrast to the netgear utility, Windows shows most of the time a weak signal, maybe because of WPA-PSK. As far as I can see you can't download only a new driver from Netgear's page (without the wireless utility). I also tried to download the new version 2.3.x software from netgear but it does not install on my German windows because they did not make the installer for international WinXP versions (it looks for a use Guest which is not present) - thanks again Netgear - I hope many people are reading this. I wrote to the Netgear Support but unfortunately their support page was down today - what a pitty ;-) Finally I completely removed the Netgear utility and installed only the driver from the CD. The driver itself is version 3.1.0.19. Now with Windows controlling the wireless connection it seems to work (no disconnection in the last few hours). BTW: Before that I also tried to turn on SSID broadcasting and to apply this strange registry AuthMode patch but this did not solve my disconnection problems :-( Oh, regarding the new Netgear software: Because my girlfriend has an english WinXp I installed the WG511v2 with the latest 2.3.x software on her notebook too. When she started to browse her computer displayed a bluescreen time to time and rebooted. The WG511v1 software seems to be definitely more stable. That's enough dear Netgear...
Best regards, Anguel