I had the same problem on a Mac system, change "GHC" to "ghc" and things will work.

I didn't even think that it was an actual bug!  Ticket #379 reports the problem.

On Tue, Oct 21, 2008 at 3:52 PM, Duncan Coutts <duncan.coutts@worc.ox.ac.uk> wrote:
On Wed, 2008-10-22 at 00:05 +0200, Henk-Jan van Tuyl wrote:
> L.S.,
>
> I keep getting the following warning for each "cabal install" command:
>     Warning: Error parsing config file C:\Documents and
>     Settings\[User]\Application Data\cabal\config: On line 1: GHC
>     Warning: Using default configuration.
>
> The first line of this file is:
> compiler: GHC
>
> What can I do about this?

Can you save a copy of the file and attach it to a new ticket at:
http://hackage.haskell.org/trac/hackage/

I'll look into why it's not parsing the old format correctly.

Once you've done that, you can delete the file and let it re-create a
default one.

Duncan

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