[Joxer]

The wireless manager reports connection status on wired and wireless connections, though exactly how it does it I don't know, but it isn't very accurate it will often indicate the connection is not working when it is.

If I am reading this correctly the OP's posts seem to indicate that the Wireless Manager was reporting the connection to the router was OK but the connection to the Internet was not OK. This will happen if you have a zeroconf IP (169.254.x.x) or a static IP in the incorrect range, this is borne out by the comment that suggests renewing or changing the IP fixed the problem.