PostgreSQL 9.0 introduced "hex" as the new default format for encoding binary data. Because "pg_unescape_bytea" only works with the old "escape" format, you need to do pg_query('SET bytea_output = "escape";'); before executing your select queries.
More details can be found here: http://www.postgresql.org/docs/9.0/static/datatype-binary.html
[Ed: Recent PostgreSQL versions support unescaping the "hex" format.]