I have two physical iPod touch devices. If I try running a program that uses a GKPeerPickerController to find another iPod touch running the same program, they just stay at the peer picker screen without any progress. Both have bluetooth enabled. I have tried my own program, along with Apple’s GKTank sample app. Neither of the iPods seem to be able to detect bluetooth devices, such as computers in discoverable mode… could this have anything to do with it?
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I was able to fix this problem by restoring the software on the older iPod. I wonder if jailbreak may have caused this issue?