I had the same experience. This seems to have worked (from T-Mobile's support forum):
1. Power the device off (remove and re-insert the battery).
2. Press and hold the Volume Up key and the Home key, then press and hold the Power key.
3. When the device vibrates; release only the Power key.
4. When the Android system recovery menu displays; release the Volume Up and the Home key.
5. Navigate with the Volume keys to the wipe cache partition option and press the Power key to select.
6. After user cache deletes, press the Power key to reboot system now.
Just did this and wifi is on and reconnected after, of course, re-entering the password.
Other solutions mentioned by people were:
Switching in and then out of airplane mode.
Forgetting the network they wanted to connect to, then re-entering
the password.
