Years ago my wifi/routers would fail every 8 months or so. I don't know why they were so short-lived, I assume it was a combination of cheap gear, poor cooling, lots of encryption work, and maybe something special about RF gear. I switched to Apple gear and I was delighted.
Until I bought my 500GB Time Capsule in July 2009. Wow, it has not been good. I've 45 posts to date on Time Capsule, and at least half are bugs and issue workarounds. Then, cough, there's AirPort Utility 6.
The most persistent problem got my attention last March. My backups would fail with firmware 7.6.2 but worked with 7.5.2. I made a number of changes, but the biggest change was I swapped around my network so it looked like this:
- DSL (yep) router - Airport Express 802.11n (upstairs)
- Time Capsule (extends AE network) in office, with wired ethernet connections to iMac 27" and printer. (So my server/main machine did TC backups via ethernet, not wifi)
- Six iPhones, an old G5 iMac, a MacBook Air and a 5+yo MacBook connecting via Wifi to AE or TC depending on location
- An old Airport Express 802.11g currently used for AirPlay only
That new arrangement, and perhaps various updates to Lion and so on, seemed to help. Until, about five months ago, backups to the 2TB drive attached to the 500GB TC started to fail mysteriously. Restarting the drive did nothing, but power cycling the Airport fixed things. I couldn't find any cause, so I just power cycled every few weeks.
Eventually, however, I was power cycling every few days.  Time to order a new 2TB TC from 30-day return Amazon.com and try a hardware swap. If I go a few weeks with backups working I'll keep the new one; for now 2TB will handle my backups without an external drive. 
That's where I am now, but today I ran into a new problem! My TC connected iMac, and all devices that connected to the TC by WiFi, were dog slow. I'm on the "12 Mbps download/896kbps upload" plan, but from my iMac the Century Link speed test gave me:
Download Speed: 625 kbps (78.1 KB/sec transfer rate)
Upload Speed: 166 kbps (20.8 KB/sec transfer rate)
Latency: 150 ms
I was ready to give CenturyLink a call, but decency required I test from the router upstairs first. It gave me pretty much what I expect:
Download Speed: 9604 kbps (1200.5 KB/sec transfer rate)
Upload Speed: 746 kbps (93.3 KB/sec transfer rate)
Latency: 75 ms
Yes, it was the connection between the AirPort Express and my brand new Time Capsule that was bad. I think I was running into the same problem Marco wrote about a few days ago -- there are problems with 7.6.2/7.6.3. In this case affecting my AE to TC connection since the AE was 7.6.2 and the new TC shipped with 7.6.1. After dropping the AE back to 7.6.1 and restarting the TC I got the same results when I'd plugged directly into the router:
Download Speed: 10298 kbps (1287.3 KB/sec transfer rate)
Upload Speed: 735 kbps (91.9 KB/sec transfer rate)
Latency: 74 ms
The TC is working at the moment, but if it fails me again it's going back to Amazon and I'll try running Mountain Lion Server based network backup.
 I also do a Carbon Copy Cloner backup of my primary machine with file archive; that encrypted drive rotates offsite with 3 other 2-3TB drives. If you don't have two completely different backup systems with at least one offsite drive at all times you're not backed up. Mountain Lion supports encryption of Time Capsule backups, but initial backup is very slow then -- even over ethernet. Seems ok afterwords. Be damned sure you can retrieve that password if your system dies.
 A lot of my hardware is 3-5 years old, so I'm expecting a flurry of failures. Slow hardware failure is pretty darned frustrating.