Am failing to set up a wireless Access Point (AP)

Am failing to set up a wireless Access Point (AP)

I am trying to get this card to be an access point on an embedded ARM board, running Ubuntu 10.04 and a self-compiled kernel (no Network Manager).
Here's the log entries on /var/log/syslog when I connect the device:
May 27 10:56:46 vab kernel: usb wakeup is here
May 27 10:56:46 vab kernel: ehci_fsl_bus_resume, Host 1
May 27 10:56:46 vab kernel: usb 2-1.2: new high speed USB device using fsl-ehci and address 8
May 27 10:56:47 vab kernel: usb 2-1.2: New USB device found, idVendor=0cf3, idProduct=9271
May 27 10:56:47 vab kernel: usb 2-1.2: New USB device strings: Mfr=16, Product=32, SerialNumber=48
May 27 10:56:47 vab kernel: usb 2-1.2: Product: WLAN
May 27 10:56:47 vab kernel: usb 2-1.2: Manufacturer: MVA1020
May 27 10:56:47 vab kernel: usb 2-1.2: SerialNumber: 12345
May 27 10:56:47 vab kernel: usb 2-1.2: ath9k_htc: Transferred FW: ar9271.fw, size: 51312
May 27 10:56:49 vab kernel: ath: EEPROM regdomain: 0x10
May 27 10:56:49 vab kernel: ath: EEPROM indicates we should expect a direct regpair map
May 27 10:56:49 vab kernel: ath: Country alpha2 being used: CO
May 27 10:56:49 vab kernel: ath: Regpair used: 0x10
May 27 10:56:49 vab kernel: Registered led device: ath9k-phy4::radio
May 27 10:56:49 vab kernel: Registered led device: ath9k-phy4::assoc
May 27 10:56:49 vab kernel: Registered led device: ath9k-phy4::tx
May 27 10:56:49 vab kernel: Registered led device: ath9k-phy4::rx
May 27 10:56:49 vab kernel: usb 2-1.2: ath9k_htc: USB layer initialized
iwconfig:
$ iwconfig wlan0
wlan0     IEEE 802.11bgn  ESSID:off/any 
          Mode:Managed  Access Point: Not-Associated   Tx-Power=27 dBm  
          Retry  long limit:7   RTS thr:off   Fragment thr:off
          Power Management:off
hostapd config file:
$ cat config
interface=wlan0
driver=nl80211
ssid=test
channel=1
And running it:
$ sudo hostapd conf
Configuration file: conf
Failed to set interface wlan0 to master mode.
nl80211 driver initialization failed.
ELOOP: remaining socket: sock=5 eloop_data=0xa4a38 user_data=(nil) handler=0x3d2f8
And output of iw list:
Wiphy phy4
    Band 1:
        Capabilities: 0x104e
            HT20/HT40
            SM Power Save disabled
            RX HT40 SGI
            No RX STBC
            Max AMSDU length: 7935 bytes
            DSSS/CCK HT40
        Maximum RX AMPDU length 65535 bytes (exponent: 0x003)
        Minimum RX AMPDU time spacing: 8 usec (0x06)
        HT TX/RX MCS rate indexes supported: 0-7
        Frequencies:
            * 2412 MHz [1] (27.0 dBm)
            * 2417 MHz [2] (27.0 dBm)
            * 2422 MHz [3] (27.0 dBm)
            * 2427 MHz [4] (27.0 dBm)
            * 2432 MHz [5] (27.0 dBm)
            * 2437 MHz [6] (27.0 dBm)
            * 2442 MHz [7] (27.0 dBm)
            * 2447 MHz [8] (27.0 dBm)
            * 2452 MHz [9] (27.0 dBm)
            * 2457 MHz [10] (27.0 dBm)
            * 2462 MHz [11] (27.0 dBm)
            * 2467 MHz [12] (disabled)
            * 2472 MHz [13] (disabled)
            * 2484 MHz [14] (disabled)
        Bitrates (non-HT):
            * 1.0 Mbps
            * 2.0 Mbps (short preamble supported)
            * 5.5 Mbps (short preamble supported)
            * 11.0 Mbps (short preamble supported)
            * 6.0 Mbp