In the xmb goto "settings/power save settings/wlan power save" and switch it on then off. Then remove the psp battery for five minutes and put it back. Let me know how you get on.
this might sound a silly question but have you accidently turned the wifi button off. maybe caught it with your finger or something? it is easily done.
there is a slide switch just above where the memory stick is. check it is not in the off posttion.
I've read some other forums (googled your error number) and it seems that it may be broken. But then you said it was working intermitently, maybe its a loose connection inside. Just a thought