I realize gpg 1.4.10 on windows has some issues. I haven't seen this particular
one mentioned, so I thought I would point it out.
C:\Documents and Settings\dak33>gpg --list-keys
gpg: invalid item `BZIP2' in preference string
gpg: invalid default preferences
Sure enough, it looks like bzip2 support was left out of this version.
C:\Documents and Settings\dak33>gpg --version
gpg (GnuPG) 1.4.10
Copyright (C) 2008 Free Software Foundation, Inc.
License GPLv3+: GNU GPL version 3 or later http://gnu.org/licenses/gpl.html
This is free software: you are free to change and redistribute it.
There is NO WARRANTY, to the extent permitted by law.
Home: C:/Documents and Settings/dak33/Application Data/gnupg
Supported algorithms:
Pubkey: RSA, RSA-E, RSA-S, ELG-E, DSA
Cipher: 3DES, CAST5, BLOWFISH, AES, AES192, AES256, TWOFISH, CAMELLIA128,
CAMELLIA192, CAMELLIA256
Hash: MD5, SHA1, RIPEMD160, SHA256, SHA384, SHA512, SHA224
Compression: Uncompressed, ZIP, ZLIB
Update: I just tried the 1.4.10a release, and have the same problem.