pg_restore with Fc fails with [archiver] out of memory error

Created a pg_dump with Fc (custom format compression) that resulted in a
300+MB file. Now trying to pg_restore this thing fails with either an
out of memory error (as in the subject line) on FreeBSD 4.10-STABLE or
a:
pg_restore in malloc(): error: allocation failed
Abort (core dumped)
error on FreeBSD 5.2.1-P9 (RELEASE)

In both cases I have increased the max data segment size to 1.5GB and
the max stack size to 768M or so.

So obviously we have some error message when malloc'ing for the AR
structure. Any ideas here? Is it trying to stuff the 300MB file into
memory and uncompress and sort it there? Has anyone found a workaround
for this? (I have found similar questions and zero answers doing google
searches and mailing list searches). Is there any way of uncompressing
this file *other* than using pg_restore?

Sven

p.s. Although I will check the archives, I would appreciate a CC on any
responses.