Some people have reported the following incorrect behaviour with PSFTP:
psftp> pwd
Remote directory is /dir1/dir2
psftp> get filename.ext
/dir1/dir2filename.ext: no such file or directory
This is not a bug in PSFTP. There is a known bug in some versions of portable OpenSSH (bug 697) that causes these symptoms; it appears to have been introduced around 3.7.x. It manifests only on certain platforms (AIX is what has been reported to us).
There is a patch for OpenSSH attached to that bug; it's also fixed in recent versions of portable OpenSSH (from around 3.8).