My MacBook Air has the flashing gray folder of death on startup and when going to the internet recovery option by holding down Option during bootup, I'm able to see a list of local WiFi networks and login to my own. But that's as far as I can get... once logging into my wireless network nothing happens and the screen just shows a dropdown with my network's name selected and the WiFi icon on the left of the dropdown connected with full bars. There's no folder or internet globe icons for me to select above the dropdown option. How do I get to the next step in this recovery process? I thought this might be because of my hard drive, so I replaced it with a brand new hard drive and I'm still getting the same issue. Update w/ fix: So I finally got it working. Needed to get a free copy of 10.7 Lion on a USB, boot from that, then format the new harddrive. Good as new.