New wireless printer won't connect to network by wireless?

I have just bought a HP C7180 All-in-one printer. The main reason being that it said it was wireless. But, it will not connect wirelessly to my network. I have a Thomson/Speedtouch 580 router (from Tiscali) and I have 1 desktop and up to 3 laptops connected to it which all work fine (wireless). When I try to set up the printer using the network wizard (on the printer) it finds my network, I type in the WPA-PSK pcode, then it says it cannot connect. I have set up the printer mac code on the ACL on the router to allow the printer to connect but still no joy. I tried reducing the security level to WEP and it worked fine, however I prefer the higher security. I have now connected the printer to the router with a cable and that works but the printer is in the wrong place and the whole point was to be wireless. I have tried HP website and phone and they were useless. Nothing on the Speedtouch website either. Anyone got any advice - should I be able to do this or am I dreaming?