Time Capsule can't connect once setup with password

My TC will not connect to the internet after I set everything up. The backup however does work; I can see it and connect to it through the finder, also I can store files on there and open those files in a PC I have in another room. But I cannot connect to the internet.

What I CAN do though is reset it and have default settings on my TC, then I am able to get a connection (the default network name is "Apple Network f55f8d" if you happen to be my neighbor, you can get free internet right now). But I can't access the HD because it asks for a password...but there is no password assigned to it!!!

I have searched all forums I can find regarding this, and have tried all the tricks I know of: resetting the modem and TC, rebooting the computers, going into system prefs/network and putting airport first, etc...

Anything I am missing?!