Part of your problem, I would say, is the router. The wireless N routers out there now are not based on any final specifications but on early concepts (they are still fighting over some of this stuff) and the wireless card inside the PS3 may not be working quite right with it.
If your router is close enough you could try doing the download via a wired connection or download the firmware from Sony's site on your PC and transfer that over to a memory card to update. I've written up a how-to for that in the sticky at the top of this section.