Comment 4 for bug 1077704

Well, I think this will be why:

==
ubuntu@dexter:~$ sudo iwconfig wlan0 mode Ad-Hoc
Error for wireless request "Set Mode" (8B06) :
    SET failed on device wlan0 ; Operation not supported.
ubuntu@dexter:~$ sudo strace iwconfig wlan0 mode Ad-Hoc 2>&1 | tail
mprotect(0x40023000, 4096, PROT_READ) = 0
munmap(0x400a8000, 92786) = 0
socket(PF_INET, SOCK_DGRAM, IPPROTO_IP) = 3
ioctl(3, SIOCSIWMODE, 0xbec98bc4) = -1 EOPNOTSUPP (Operation not supported)
write(2, "Error for wireless request \"Set "..., 47Error for wireless request "Set Mode" (8B06) :
) = 47
write(2, " SET failed on device wlan0 ;"..., 58 SET failed on device wlan0 ; Operation not supported.
) = 58
close(3) = 0
exit_group(-6) = ?
ubuntu@dexter:~$
==

Now just have to figure out where that error is coming from. It's likely somewhere in /drivers/net/wireless/bcmdhd I guess, since we're using the stock kernel.