I have an USB toy that's based on that same chip, and it works without a hitch using wpa_supplicant. The relevant output follows:
Code:
# lsusb
...
Bus 002 Device 003: ID 148f:3070 Ralink Technology, Corp. RT2870/RT3070 Wireless Adapter
# lsmod
Module Size Used by
...
rt2800usb 13777 0
rt2800lib 38939 1 rt2800usb
crc_ccitt 1251 1 rt2800lib
rt2x00usb 8674 1 rt2800usb
rt2x00lib 32905 3 rt2800usb,rt2800lib,rt2x00usb
mac80211 184818 3 rt2800lib,rt2x00usb,rt2x00lib
...
cfg80211 160852 2 rt2x00lib,mac80211
...
I didn't do anything else, that I can remember to get it working, but install wpa_supplicant and start /etc/init.d/net.wlan0 (which, as usual, is just a symlink to net.lo). I didn't even configure /etc/conf.d/net. I assume your system uses udev as usual, otherwise autodetection won't work, I guess.