When I was having trouble with mine, I discovered that it was due to my Mac Time Machine. (a piece of routing equipment designed to back up my Mac.) So perhaps if there's a hub or additional "barrier" between your router and your Nook, it needs to be disconnected.
Hope that helps some.
I am soooo glad I found this post.
I just bought a Nook Color this morning -- and have already spent hours trying to get it to connect to my 2Wire router. Neither B&N nor AT&T tech support were of any help.
But you had the answer: I needed to use the 10-digit number on my router -- not my wireless password. As soon as I did, my Nook found the elusive IP address and was good to go!