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We had a look at this bug during a sprint last week. First, it is reasonable to use --sign without --identity, as gpg will fall back to a default identity (see the description of --local-user and --default-key in the gpg man page). Second, it looks like you run distutils commands from a script or makefile and you have a bug there (the "skipped "gn"" message looks suspicious, maybe -sign was used instead of --sign and interpreted as -s -i gn). Finally, even though we thing this is not a bug, we agreed that it would be nicer to print a message to make clear that distutils2 is not broken but shows the error message from gpg on purpose; this may be done during the next sprint.