Check the server error log and search for "nspostgres" to find out why the database is not connecting.
If you change the version of PostgreSQL you need to recompile nspostgres with that version.
But first, how did you get the "lasted .LRN". The latest release of .LRN should support PostgreSQL 7.4 and 8.0.
This is the newest release .LRN 2.2.0 https://openacs.org/projects/dotlrn/download/download/dotlrn-2.2.0.tgz?revision_id=468768
