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Lots of chatter on the Kindle forum about issues with the 3G connection on the 2nd gen Kindles. Some is because of Sprint dropping support for 3G, but there is something else going on with those 2nd gen devices. You have the AT&T model in any case.
I just traded in my old K2, and after resetting it to factory specs, it still showed on my account at Content & Devices. I wasn't able to deregister it there either, it took a chat with CS to remove it from my account. I assumed this was due to the same issue others are having with those models.
Adding...Amazon never did intent to provide open browsing on those models. It still works to connect to their store, all they intended it to do anyway.
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