I faced problem with connecting itouch to BSNL home network. The issue was in encrypton method used. My modem was configured for WEP connectivity. Ipod, it appears, does not use WEP for connectivity. When I changed the method to WPA with key as PSK.
To check the problem type 192.168.1.1 on your browser. Supply username as admin and password admin. Go to Configurations->wireless network. Make sure that you are connected to router via ethernet cable. Under security settings check if security option is WPA or not. If not change it to WPA (WPA mixed mode in my case) Supply a pass phrase e.g. 9999555522 or ur phone number. PMK caching disabled. Confirm it.
