SQLDriverConnect hangs when DB inaccessible

When I call

SQLDriverConnect (hdbc, 0, (UCHAR *) dataSource_.c_str(),
SQL_NTS, (UCHAR *) buf, sizeof (buf),
&buflen, SQL_DRIVER_COMPLETE);

from C++ code and the DB is accessible, the function returns as
expected. However, when the DB is inacessible, this function hangs
somewhere. There is obviously something happening, running "top"
shows my CPU usage near 100% until I control C out of my app.

Relevent versions of packages I'm using are

Red Hat Linux 9.0
PostgreSQL 7.4.1
psqlodbc 7.2.5
unixODBC 2.2.8

The relevant bits of my .odbc.ini file are

[postgres]
Driver = /usr/local/lib/psqlodbc.so
Setup = /usr/local/lib/libodbcpsqlS.so
Description = PostgreSQL Data Source
DSN = postgres
Servername = localhost
Port = 5432
Protocol = 7.4
UserName = myusername
Database = mydbname
ReadOnly = no
ServerType = Postgres
FetchBufferSize = 99
ServerOptions =

I build PostgreSQL, psqlodbc, unixODBC and my app using gcc/g++ 3.2.2.
Any ideas why things hang when the DB is inaccessible?