installed pinentry not found by gpg-agent/gpg2

[snowcrash+gnupg-users]

i've built/installed,

	% glibtool --version
		ltmain.sh (GNU libtool 1.2361 2007/01/21 16:15:36) 2.1a
	% pinentry --version
		pinentry-qt (pinentry) 0.7.3-cvs
	% gpg --version
		gpg (GnuPG) 2.0.2-svn4407

on osx 10.4.8.

testing as follows,

	% touch temp.txt
	% ls
		temp.txt
	% gpg -r snowcrash at mydomain.com -e temp.txt
	% ls
		temp.txt  temp.txt.gpg
	% gpg -o blah.txt -d temp.txt.gpg
	
		You need a passphrase to unlock the secret key for
		user: "Snowcrash (Snowcrash) <snowcrash at mydomain.com>"
		1024-bit ELG key, ID 034BEA3D, created 2003-08-16 (main key ID A2C3EBC6)
		
		gpg: problem with the agent: No pinentry
		gpg: Invalid passphrase; please try again ...
		
		You need a passphrase to unlock the secret key for
		user: "Snowcrash (Snowcrash) <snowcrash at mydomain.com>"
		1024-bit ELG key, ID 034BEA3D, created 2003-08-16 (main key ID A2C3EBC6)
		
		gpg: problem with the agent: No pinentry
		gpg: Invalid passphrase; please try again ...
		
		You need a passphrase to unlock the secret key for
		user: "Snowcrash (Snowcrash) <snowcrash at mydomain.com>"
		1024-bit ELG key, ID 034BEA3D, created 2003-08-16 (main key ID A2C3EBC6)
		
		gpg: problem with the agent: No pinentry
		gpg: encrypted with 1024-bit ELG key, ID 034BEA3D, created 2003-08-16
			  "Snowcrash (Snowcrash) <snowcrash at mydomain.com>"
		gpg: public key decryption failed: Bad passphrase
		gpg: decryption failed: No secret key
		
	%

i'm not sure what to do about the "no pinentry", as it's 'there',

	% ls -al `which pinentry`
		lrwxr-xr-x 1 root admin 11 2007-01-21 11:29 /usr/local/bin/pinentry
-> pinentry-qt
	% ls -al `which pinentry-qt`
		-rwxr-xr-x 1 root admin 2245584 2007-01-21 11:29 /usr/local/bin/pinentry-qt

in a standard path location.

suggestions?

thanks.