1)put the key in the ignition (do not turn key yet)
2)turn steering wheel as far to the left as you can while keeping pressure on it
3) while still holding wheel, turn ignition and viola!

either that or the button that hits the key is only being partially engaged


or try

If you need to take the barrel out, put the key in the ignition and turn to the first position, then shove a paper clip or similar bit of wire in the little hole and it will pull out.