This is my first portable WiFi gadget, and I'm wondering if it's doing what it's supposed to when trying to connect.

Just wandering around, I see lots of unencrypted routers, but am almost never able to connect to them. It gives either "Network connection error" or "Unable to obtain IP address". On some of these the signal strength is half a bar or better.

I have been able to connect to three out of the four legitimate WiFi hotspots I tried.

Is that normal, not to be able to connect to random unencrypted routers?

Is there anything I can learn from either of those error messages other than that the connection didn't work?

Depends if they are not secured. I run my router with limits on the MAC address, so it shows up as unsecured but unless you have a MAC address I've entered you can't connect.

Also just because it's a wireless network doesn't mean there is a internet connection there. There can be wireless networks that are just for sharing files, media, whatever.

....an ad-hoc network maybe?

Yes, it's perfectly normal that trial and error includes error. Don't worry, your world is still sane.

Unfortunately, the tablets are too user-friendly to provide much information. With special software you could learn some more but I don't know if anything useful was ported to maemo.

I can explain the "Unable to obtain IP address" error. It means: "The first step, connecting to the AP was probably successful, but the second step, obtaining an IP address from the DHCP server failed." or paraphrased "I think I'm online and a I started to talk but no one answered".

There are many ways to configure a wireless network and most of them require the AP and the client to be configured manually: Authentication, Encryption, IP addresses, routing. There is only one configuration which will work automagically (no security, IP addresses retrieved from DHCP). Bad practise defaults to this configuration.

The biggest times I run into this is when there are ADHOC networks around. For some reason a Windows workstation appears to broadcast any SSID's it's connected to in the past as an adhoc network when no network is available.

Usually these SSID's are bad: Free Public Internet, HP Setup

Those are the big ones that fail.

Yeah! Sorry, I forgot the name.

Worth repeating: Stay off those ones if you see them (search through the forum for earlier thread if you're interested).

Slightly off topic but when your connection icon shows a blue centre (as below) does that indicate that it's connected to an ad-hoc network?

Affirmative.