Pydoc fails on the following exception. There is a mail discussing it: http://mail.python.org/pipermail/python-list/2009-December/1230790.html

C:\Python27\Lib>pydoc -k file
...
...
Traceback (most recent call last):
  File "C:\Python27\Lib\pydoc.py", line 2338, in <module>
    if __name__ == '__main__': cli()
  File "C:\Python27\Lib\pydoc.py", line 2277, in cli
    apropos(val)
  File "C:\Python27\Lib\pydoc.py", line 1974, in apropos
    ModuleScanner().run(callback, key)
  File "C:\Python27\Lib\pydoc.py", line 1939, in run
    for importer, modname, ispkg in pkgutil.walk_packages(onerror=onerror):
  File "C:\Python27\Lib\pkgutil.py", line 110, in walk_packages
    __import__(name)
  File "C:\Python27\lib\site-packages\pypm\__init__.py", line 22, in <module>
    import setuptools
  File "C:\Python27\lib\site-packages\setuptools\__init__.py", line 2, in <module>
    from setuptools.extension import Extension, Library
  File "C:\Python27\lib\site-packages\setuptools\extension.py", line 2, in <module>
    from setuptools.dist import _get_unpatched
  File "C:\Python27\lib\site-packages\setuptools\dist.py", line 28, in <module>
    _Distribution = _get_unpatched(_Distribution)
  File "C:\Python27\lib\site-packages\setuptools\dist.py", line 24, in _get_unpatched
    "distutils has already been patched by %r" % cls
AssertionError: distutils has already been patched by <class py2exe.Distribution at 0x0000000005987408>

For the record, the proposed solution in that e-mail is the following:

"B) Patch the run() method of pydoc module at line 1862:

for importer, modname, ispkg in 
	pkgutil.walk_packages(onerror=lambda s:None):"

I believe this problem has been fixed by the changes for Issue7425 which will be released in the next updates of Python 2.7 (2.7.3) and 3 (3.2.3).