Only thing I can think of is if you turned off WEP/WPA/encryption the only thing I can think of would be making sure you don't have MAC address filtering enabled.
Also, what wireless protocol version are you using? a, b, g, or n? The iPhone I don't think supports N so you need to make sure your router is also using G.
You'll also want to make sure you don't have MAC filtering enabled on the router.
If all else fails -- you might reset the router, forget the network in the iPhone, re-setup the router, and then try again with the iPhone.
Make sure your iPhone has the latest 3.1.2 firmware I believe, too.