Hi Ed,
Allen Hutchinson has written an excellent blog post showing how to
work around this exact issue:
http://allen.hutchison.org/2009/03/appengine-remoteapi-example-on-os-x.html
The long and the short of it is that App Engine bundles a copy of
PyYAML, and expects it to be present, but the path hack I presented in
the article doesn't include it. You can either follow Allen's
suggestion and modify the script, or you can install the PyYAML
module. If you have easy_install, that's as simple as "easy_install
pyyaml".
-Nick Johnson