IBM T40p, WIndows XP pro, 802.11 a/b interface card, WPA2 encryption possible?

I have six-year old old T40p with the 802.11 A/B mini PCI installed and five-year old Asus motherboard that comes with the soldered-on 802.11 G WIFI NIC card.
These two PCs do get connect through WEP encryption but refused to connect through WPA/WPA2.
I did update the drivers with the latest ones I could get. I went through Microsoft's own troubleshooting guide without much help.

On my old IBM T40p with Windows XP pro SP3, the hotfix for the WPA from Microsoft refused to install insisting that the one I have is newer than the hotfix could allow. The OS allows me to choose WPA encryption but it won't let me get in details to choose from WPA-personal to WPA2 or TPIK to AES, etc. Simply, there is a box to check if I wanted to go with the WPA but nothing more and that doesn't work either.

On my Asus with Windows 7, however, it shows all the WIFI goodies you would see as on the latest Vista OS. But it simply won't allow me to get connected through WPA or WPA2 encryption . It does let me get connected through WEP which is an invitation to all the crooks out there.

I have a newer notebook that works well through WPA or WPA2 so I know it's not the problem with my WIFI router settings.

Hence my question is, is the WPA encryption hardware dependant? Could it be fixed through software driver update or am I stuck with WEP due to obsolete hardware? Is there anyway to upgrade the firmware (not the driver) on the NIC itself?

I tried to find a mini PCI NIC replacement on eBay for the T40p and found out that some newer NIC cards are WPA2 compliant and others weren't. I don't know if these ads were just a marketing gimmic but I'm beginning to wonder if the WPA2 encryption is really dependent on the hardware.