I have found this problem a couple of times. Windows 7 with Intel AGN 5100 won't connect to a WPA2-PSK router when it's too far away.
Both times I've had this happen I was in a foreign country (London and Stockholm), and both times I was upstairs while the router was downstairs.
Now, it still has 2-3 bars when looking at local WiFi, but I get the "will not connect" error, and debugging doesn't help at all (it doesn't know what's wrong). I went downstairs and it connected immediately (but I need to be able to have it upstairs).
My Android Cell Phone and iPad were able to connect upstairs just fine.