migration problem

I know this is not strictly a pgadmin issue, but I don't know where else to
turn.
At worst, perhaps someone can steer me in the right direction. :))
Dave seems terribly knowlegable on pgsql, so I thought I'd risk the question:
I am trying to restore a database from a gzipped file: I believe that
backups were done as complete files (not partial) under Postgresql 7.0.3.
Pg_restore does not recognize the ungzipped file "filename.psql". The
command, psql -d database -f filename.psql, restores it partially, but with
numerous errors and the database is mostly empty. As I understand, this
command restores the file to an existing database, so I had to create one
with the original filename. But I don't know if the newly created database
must have the exact same permissions, ownership, etc. as the original.
I am told to install the earlier version of Postgresql to restore, but that
does not work - cannot configure it. Even if that works, how can the
restored database be migrated to a newer version of Postgresql?
Does anybody out there know about this kind of thing?
Thanks for any help.
P. Jourdan