Airport express and Airport utility
Download the Lion version 5.6 of Airport Utility , which actually works with setting up / reconfiguring an Airport Express.

Both versions (ML comes with 6.x) can be used on Mountain Lion. Keep both around, for now.

Though once setup, my AE responds well to AU 6.x. 

I don't know why .. but then, ours is not to reason why, is it.