I'm actually experiencing the exact same thing. I washed my original Pre (yeah yeah). The mic stopped working so I had to borrow one from a friend.
He did a full wipe before giving me the phone. I had Sprint activate his phone.
I could not restore my profile. It says, "Sign In Failed, We were unable to sign you in. Contact Palm for help resolving this."
I spoke to palm via their chat support. The referred me to their phone support, who tried the following:
Tier 1: Various restarts, no luck
Tier 1: Performed erase, no luck
Escalated me to their Tier 2 support.
Tier 2: Performed an erase, no luck
Tier 2 Performed a WebOS doctor, no luck
I tried to create a new profile just for kicks. Similar error, "Can't create new profile, call Palm for assistance."
The Tier 2 rep told me the problem is the radio.
HP/Palm said they could repair my pre for $199 (no way). Can any of you think of any alternatives? Am I forced to get an Android phone? Which would suck with the Pre3 right around the corner.