psql bug or feature?

I don't understand following behavior of psql:-)
This is PostgreSQL 7.1.2 on Linux.
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Tatsuo Ishii

$ psql pgimage
Welcome to psql, the PostgreSQL interactive terminal.

Type:  \copyright for distribution terms      \h for help with SQL commands      \? for help on internal slash commands
    \g or terminate with semicolon to execute query      \q to quit
 

pgimage=# \lo      List of databasesDatabase  |  Owner  | Encoding 
-----------+---------+----------ascii     | t-ishii | EUC_JPfoo       | t-ishii | EUC_JPfoo1      | t-ishii |
EUC_JPlatin1   | t-ishii | LATIN2pgimage   | t-ishii | EUC_JPtemplate0 | t-ishii | EUC_JPtemplate1 | t-ishii |
EUC_JPtest     | t-ishii | EUC_JPtestdb2   | t-ishii | EUC_JP
 
(9 rows)

\l: extra argument 'o' ignored
pgimage-# \lo_list    Large objects  ID    | Description 
---------+-------------2401715 | 2401723 | 2401726 | 2401739 | 2401742 | 2401754 | 2401757 | 
(7 rows)

pgimage-# select * from pg_database;
ERROR:  parser: parse error at or near "m"
pgimage=#