The Nexus One issue with Wifi Sleep Policy is a known issue.
Google Nexus One Support

While I’m working on the beta of Wifi Fixer 0.7.0.2, I’ve been taking a crack at workarounds.

With the participation of members of the support forum, I found something that works for a very few people. (Thanks to those who volunteered their devices and sent logs.)

So, once 0.7.0.2 is released, simply set Wifi Usability to Max Wifi (so Wifi Lock and Disable Sleep are on in Advanced Options)

How does it work? Essentially, by doing the network check that Wifi Fixer does with the screen on, but doing it only once a minute. One big difference if the network check fails, a wake lock is acquired, then after a few seconds, an attempt to reconnect is made.

I’ll be honest. Your odds are poor of it working. Only a few of the respondents from the forums had the same results I did.

I’m thinking the issue lies deep in the drivers and/or framework, so is beyond the scope of Wifi Fixer to deal with. I’d ask that when 0.7.0.2 is released those afflicted with the problem send me logs, so that I can try to get all my collected data to the appropriate engineers.

I’ve added a Known Issues page to the documentation built into Wifi Fixer which explains this issue and some others.

****Update***

RyGuy at google had this to say in the forum:

Hey everybody,

I’d like to thank the community for compiling all this information about the WiFi sleep policy on the Nexus One and other Android devices. The option to disable WiFi sleep is not compatible with every router, as a lot of you have figured out. When the screen on your device turns off, the WiFi functionality of your device doesn’t go to sleep, but does enter a low power mode that can cause problems with some routers. In general, we don’t recommend changing the default setting for the WiFi sleep policy (“When screen turns off”).

Again, thanks for all the work done compiling this information.

-Ry Guy

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