Trouble connecting via ad hoc

I am having the Wifly RN-XV module start up in ad hoc mode by having 3.3v to pin 8 as per the user manual. On power up I am getting the consecutive green, yellow, and red flashing. The wifly module shows up in my networks. I connect to it. This is where the problem comes in. Sometimes I am told that I cannot connect to the wifly. Sometimes I connect to it successfully, but then it disconnects shortly. I then just get a rapid red flashing light and a slow blinking green light. When trying to do telnet with Tera Term it says connection time out. I am thinking it is a hardware issue. Any thoughts?

What does "I connect to it" mean? Have you configured your PC, notebook or whatever for ad-hoc connections?