Here is a screenshot from my WiFi manager that shows the network I am currently connected to. In the same block it says I’m not connected, but then says I’m currently connected. I am in fact connected, which is how I am able to make this post.
Why is Windows so confused about this?
I would guess that it does not update both informational displays at the same times, and you caught it after one was updated but before the other was.
This is consistent behavior no matter when I check, if I am connected to that network. Haven’t checked what happens on other networks.
It’s pretty stupid, but two different meanings for the word “connected” are being used. In one sense, to “connect” to a network means you’ve told windows that you’d like to use it, and you probably provided a password when you did so. You’ve probably done that with the first network listed there, but not with the other two, since those belong to your neighbor or something. And in the other sense, to “connect” to a network means that you’re in range and actually currently communicating with that network. Which you aren’t.
Clear as mud? 
I don’t see how. The network in WEP encrypted so I indeed provided a password, but I am also actively using that network to connect to the Internet.
Had a similar problem just the other day. Here’s how I fixed it:
Go to Start --> Programs --> Accessories --> Communications --> Network Connections --> Right-click your Wireless Connection and select Properties --> Click on the Authentication tab --> Disable / uncheck the option IEEE 802.1x authentication for this network. Restart your computer and then see if you still get disconnected.
Along with this, restart the computer, and once it has established a connection to the Network, goto Start --> Run --> type services.msc and press OK --> Scroll down to Wireless Zero Configuration (it’ll be at the bottom), right-click and select Properties --> Click Stop – wait for the service to stop, and then click OK. Once the service is stopped, continue browsing.
Did that work?
