I tested out today new beta kernel released for PS3. It indeed seems that some progress was done with firmware 2.00. I can nicely see that access point scan shows better values for my WPA1+2 network. Actually it shows now new WPA2 values.
Now everything would had been nice if YDL had also updated this aspect on their kernel update... Now it tells that we have this new type of security and this version of driver doesn't actually know how to handle it correctly... Rebooting and trying to reload network again (/etc/init.d/network restart) got it associated nicely.
In bleeding edge driver there are new encryption modes that should be settable with 'iwpriv eth0 set_alg 4' for WPA2-PSK TKIP and 'iwpriv eth0 set_alg 5' for WPA2-PSK AES. But YDL's kernel driver doesn't accept values of 4 and 5... So if you are running WPA1 only network, then your setup should work fine (haven't tested it out though), if you also have WPA2 enabled then you may have some problems making connection.