Try this. Use "address reservation" in the router (sorry, but read the router manual) to see if that helps. If the phone is not so bright about grabbing an address then it can knock devices off the WiFi.
Fix? get wired and try address reservation. Yes there are more suggestions such as updating the router's firmware but you've read that before.
I have a sony bluray player which we stream netflix through. When my son turns on wifi on his droid razr netflix will shut down stating a network error. We do not have this problem with my iphone or my other sons LG cell phone.