This was a very helpful thread. Thank you so much. I have my WPA-PSK working in under an hour.

One thing that may be helpful for others. If you are not using the ipw2200 network driver then you need to change the wpa_supplicant -D parameter.

In my case I had to change it to the following for my atheros chipset wifi card:

sudo /usr/sbin/wpa_supplicant -B -dd -i ath0 -c /etc/wpa_supplicant.conf -D madwifi -w

Note that the /etc/init.d/ script also needs changing. If you're not sure what the parameter should be then the following is what my version of wpa_supplicant will accept: