First off, I work as a network engineer myself so I am VERY, VERY familiar with the difficulties that occur with WiFi networks, and how to properly configure them and so-forth. The router, IS running the latest firmware releases, in-fact, I stay up-to-date on these updates on a monthly basis, so the problem ISN'T MY NETWORK... Everything else on the network works just fine... I support well over 200 devices on my local network without an issue...
As for defective product, well, I've exchanged two of them now, so now we have three devices; all from different product lots and all different serial number lots. So, is it me or Apple's lack of quality control???
I've called Apple, their only answer is to return the device for a new one. It's a 30 miles drive each time I need to perform an exchange. I've been back and forth three times today already.
I've tried several routers, including commercial ones and our Apple Time Machine with the latest firmware installed. And still, none of the three can connect... I've tried OPEN WiFi, WEP, WPA, WPA2, TKIP, AES, and so-forth and still, none of the three iPads can connect...