1. Trash a preference file (com.apple.bluetooth.plist) and restart.
2. Delete the keyboard, restart, and the BT setup assistant should try to pair the device.
Apple – Support – Discussions – Navigation using a Bluetooth keyboard …. No this isn’t possible.
Apple – Support – Discussions – Bluetooth: Not Available …. It turns out that the hardware was broken according to the Apple Store. Some suggested software fixes in the thread.
Apple – Support – Discussions – Keyboard not working properly …. Turns out that removing the two items in the Login items for the user fixed the issue.
Apple – Support – Discussions – iPad keyboard dock doesnt work – how …. How frustrating for the iPad owners to find that their keyboard dock keeps breaking. I would try to get a bluetooth keyboard if this was me. The only solution this thread mentions is taking the broken keyboard into the Apple store and getting a new one.