Vista Laptop (wont accept network key)

Just bought a Fujitsu Siemens Amilo Pro V3515 installed with Vista Home
Basic. The laptop will not connect by wireless to my Modem/Router. when it
says "Connect to internet" I click it. Then the available wireless networks
come up and I choose mine. It then asks for the Network Key which I type in.
It then comes back that this is the wrong Network Key.The key is totally 100%
right as it is being used on my old XP laptop which has never had any
problems. I tried connecting it to a nearby unsecure network and that worked
fine. Need help urgently. Thanks.

Cable & Wireless ADSLR10CW3 Wireless Modem/Router
WPA pre-shared key ENABLED
Data encryption - TKIP

FURTHER UPDATE - After spending 6 hours trying to get this working, I
progressed slightly. My Laptop will connect to my modem ONLY if I disable WPA
on the modem. This however leaves my network completely open to attacks etc.
If I turn WPA on again, it disconnects and back to square one. Please please
can somebody help. Im going crazy.