Oh! It looks like you have a query that's killing the PG backend ... you need to isolate it (try turrning on "verbose"). Generally PG-killing queries are repeatable, i.e. if you isolate it you'll be able to crash it in PSQL, too - while you figure out a workaround.
Regarding stacksize ... I think the 128*1024 actually comes from AOLserver folk, come to think of it, normally commented out in the default .tcl file?
Mark's post triggered my memory - aD used more like 512KB with the early ora8 incarnation for the reasons he mentions, IIRC.