It does work. What are the exact commands you use? Because just typing in ifconfig it will not show you your wirless interface you have to bring it up by using the up command in ifconfig. Did you do these next commands?
iwconfig command is to find your wireless interface.
OR you can use the the bottom one I personally like the bottom better.
root@bt~# /etc/init.d/networking start
Now did your command look like the one below? And if so what did you get?
And where I put in wlan0 I got from reading your post.
root@bt~# ifconfig wlan0 up
Also did you get the next command but this time with error 132?
If you get that error you need to look at THIS website off of backtrack.
root@bt~# ifconfig interface up
SIOCSIFFLAGS Unknown error 132
It happens to be because of the rfkill switch. So even tho you are able to see you interface the drivers rtl8187 tend to not agree with the rfkill. Your card should be compatible but until the developers of the rtl8187 make a better driver to address the rfkill. You will have to follow that website of backtrack that I sent you to force the drivers off of the rfkill (radio frequency kill).
If that was your problem use dustyboner replay by going into the wicd manager. And then clicking the prefreences tab, in the wireless modual type in your interface if its not in there. In your case wlan0 from what you posted.
But did you get that 132 error?
When you plug in your device and you are able to see the interface in the airmon. Use this command.
If it list's rtl8187 then yes you should have that problem and going to that site will help you address a work around to the problem.
root@bt~# lsmod|grep rt