Well I downloaded the RTL8187L driver package and did a clean install and it still didn't work. I finally took it down to the coffee shop just to try it with a different router and confirmed that the adapter is in fact working. Which is a big relief because I was really worried I had a defective product and the guy that sold it to me is useless, no way I'd ever get my money back.

For some reason it won't connect to the open networks around my house but it will connect to the encrypted one at the coffee shop. I used the small 3" dipole antenna at the coffee shop but at the house I have a 15 dBi panel antenna mounted on a tripod on my balcony connected to about 20' of low loss cable. The signals with this antenna are VERY strong and the range must be quite good too because the number of networks I'm detecting is insane.

The only thing I can figure is the cable is bad or I am getting feedback or interference somehow. I'll keep trying and post back here with the results.