i've the same problem but on 2.6.36 which is now a stable release on kernel.org. dhclient stalls indefinitely, trying to set an ip and doing a ping makes the interface led blink but nothing else the network is unreacheable.
I am having this same issue with stock 2.6.36 and the Sheevaplug. It works fine with the previous stable 220.127.116.11.
Check your arp table (arp -v), I have noticed mine shows "incomplete" where it should be showing hardware addresses, like they're being corrupted at some point.
I am in the process of building a custom 2.6.36 using the driver from 18.104.22.168, and seeing if it functions again. Afterwards I am going to move from commit 9b2c2ff7a1c04e69842254dd4afe0f8ad4efa439 (which appears to be the last one applied in 2.6.35) up until 50a749c1f2fc8f03232c174c9dbc78a78f9bebfd, where it isn't working to try and figure out at what point it was broken.
To some of the above commentary, 2.6.36 was only just released, until that point the latest official release was 22.214.171.124... the "rc" part shows as much, it is a candidate and not the actual stable release, rather a development snapshot.