Try starting to Internet Sharing app, click "Connect" and immediately, before it can connection, click "Disconnect". That has fixed it for me in the past.

For a permanent fix go to the "Sprint HTC Mogul/SERO Notes" section in the following thread:
Internet Sharing over Wifi - USB Edition - with 10min TimeOut Fix (Nov-1-2007) - xda-developers

The thread also explains a newer method of Ad Hoc WiFi Internet sharing, written with the HTC Mogul in mind.