Perhaps one (or more) of the characters you're trying to use aren't being interpreted properly?

Does it work as expected if you run the inithook directly? I.e.:

/usr/lib/inithooks/bin/pgsqlconf.py --user='postgres' --pass='superpassword'

If it worked as it should, then it will pause and return without an error message (or any output at all IIRC). And then you should be able to log into Postgresql as the default user ('postgres') using the new password.

If that still doesn't work, perhaps try some different characters? You could also try running it interactively (although I'm not sure whether that would help?):

/usr/lib/inithooks/bin/pgsqlconf.py