I am having the same problem and trying to fix it. I updated my firmware, tried running the setup wizard, that doesn't offer to turn on WPA, only WEP. I'm wondering if this router doesn't support WPA and it's a mistake that it shows that option in the drop down menu...
Current Firmware Version: 1.21
Firmware Date: Thu, 22 Sep 2005
I upgraded to
Current Firmware Version: 1.23
Firmware Date: Mon, 24 Jul 2006